Alembic Business Data

Alembic Pharmaceuticals Limited
Annual Report 2012-13
control your destiny or someone else will

- Noel M Tichy and Stanford Sherman
Disclaimer
The report contains forward-looking statements, which may be identied by their use of words like plans, expects, will, anticipates, believes, intends, projects, estimates or other words of similar meaning. All statements that address expectations or projections about the future, including but not limited to statements about the companys strategy for growth, product development, market position, expenditures, and nancial results, are forward-looking statements. Forwardlooking statements are based on certain assumptions and expectations of future events. The Company cannot guarantee that these assumptions and expectations are accurate or will be realized. The Companys actual results, performance or achievements could thus differ materially from those projected in any such forward looking-statements. The Company assumes no responsibility to publicly amend, modify or revise any forward-looking statements, on the basis of any subsequent developments, information or events.
Contents
Corporate Identity 03 Financial Progress 04 Highlights, 2012-13 14 Chairmans Message 16 Global Generics 20 Analysis of Financial Statements 21 Risk Management 24 Directors Report 27 Report on Corporate Governance 34 Standalone Financial Statements 42 Consolidated Financial Statements 71 Corporate Information 87
Some years ago, we resolved to reinvent our
business, convinced that either we took control of it our destiny or someone else would. The result is evident in the numbers.
In a challenging 2012-13, the evolution was most distinctly visible, as we grew revenues by about 4% and PAT by 27% over the previous year.
The last three years have been seminal in the history of Alembic. The Company extended from Generalised therapies to Speciality therapeutic segments and launched aligned portfolios.
Launched new therapeutic divisions. Widened its regulated markets coverage. Increased product complexity. Increased the proportion of speciality products. Climbed the ling value-chain (Para III to Para IV and Para IV FTFs in the US). Doubled its API basket. Streamlined systems and processes. Strengthened its people management. The results have been explained in the following pages.
10.23%
EBIDTA margin, 2009-10
16.79%
EBIDTA margin, 2012-13
2 Alembic Pharmaceuticals Limited
Alembic Pharmaceuticals Limited

Enjoys leadership within the Macrolides segment of antiinfective drugs in India.
Alembic Pharmaceuticals Limited (headquartered in Vadodara, India) is a vertically-integrated pharmaceutical company. The Company possesses manufacturing facilities at Panelav in Gujarat (USFDA-approved for APIs and formulations), Karkhadi, Gujarat (USA FDA-approved for API) and Baddi in Himachal Pradesh (manufactures formulations for Indian and emerging markets). The Company has a state-of-the-art research centre at Vadodara. The Company enjoys a sales presence in more than 75 countries (regulated and emerging).
Vision
To become a knowledgedriven global pharmaceutical company with the highest level of operational excellence in all spheres
Mission
To provide access to the best healthcare products at affordable prices to everyone, present anywhere in the world.
Annual Report 2012-13 3
MANAGEMENT DISCUSSION AND ANALYSIS
Assuming control is good for the Company, for the shareholder and every stakeholder
Business
Revenue (` lac)
151,725
EBIDTA (` lac)
25,589
Net prot (` lac)

16,525
Cash prot (` lac)

20,022 8,256 2010-11 11,498 2011-12 16,378 2012-13 Over 2011-12 2009-10* Cash prot growth CAGR over 3 years 2012-13
146,235
120,205
22,085
113,814
16,033
11,688
2010-11
2011-12
2012-13
2010-11
2011-12
2012-13
3,954
2010-11
8,539 EBIDTA growth 2009-10* Net prot growth CAGR over 3 years Over 2011-12 2011-12 CAGR over 3 years
2009-10*
Revenue growth
3.75% 10.06% 15.87% 29.58% 26.99% 60.08% 22.25% 34.35%

Over 2011-12 CAGR over 3 years Over 2011-12
2009-10*
13,013
Business progression
Profitability
EBIDTA margin (%)
16.79
Net Prot margin (%)

10.84
ROE (%)
33.41
ROCE (%)
31.40 9.72 2010-11 20.75 2011-12 24.72 2009-10* ROCE growth
15.06
13.34
10.23
7.10
8.87
2010-11
2011-12
2012-13
3.46
2010-11
2011-12
2012-13
11.69
2010-11
28.92
2011-12
2012-13
33.30
2009-10*
2009-10*
EBIDTA margin growth
Net margin growth
2009-10*
ROE growth
173 bps 656 bps

Over 2011-12 Over 2009-10
197 bps 738 bps

Over 2011-12 Over 2009-10
(11) bps 2161 bps

Over 2011-12 Over 2009-10
668 bps 2168 bps

Over 2011-12 Over 2009-10
* Financial year 2009-10 numbers reect those of the erstwhile Alembic Limited, whereas for the subsequent years (2010-11 onwards) the numbers reect the impact of the demerged Alembic Pharmaceuticals Limited.
2012-13
Controlling our destiny
Building a US presence
Alembic resolved to grow its US presence with the objective to graduate from being just another pharmaceutical player to a globally recognised organisation.
Shift
We led 57 ANDAs (received approvals
Achievement
Our US business revenues grew 138.23%
for 24 ANDAs as on March 31, 2013); we commercialised 15 of the approved lings (eight products launched in 2012-13 of which three are products with sizeable potential).
We graduated the regulatory index from
in the three years leading to 2012-13.

We received USFDA approval for our
NDA Desvenlafaxine Base Extended Release (bioequivalent version of the innovator drug Pristiq by Pzer), which provides the Company with a 21-month exclusivity.
Para III lings to Para IV lings; we possessed 27 Para IV lings as on March 31, 2013 against no such lings three years ago.
We led seven Para IV including three FTF
Blueprint
We plan to commercialise 8-10 products
annually for the next three years.

We expect to register 10-12 ANDA lings
applications and one 505(b)(2) ling in the 12 months leading to the close of 2012-13.
We enriched our US basket from three
in 2013-14, which also includes Para IV FTF lings.

We are strengthening our technology
products in 2009-10 to 15 products in 2012-13. capability manifested in new nished dosage forms.
Promising oppor tunities
IMS size (US$ billion) of Alembics pending approval ANDAs
27
Stronger European footprint

Alembic resolved to sweat its assets efficiently; it leveraged its US filing success to enter the European pharmaceutical market, the second largest in the world.
Meaningful presence
Shift
We grew our European presence from one
product to ve products in just two years.

We entered into more than 15 marketing
alliances in 2012-13, making it possible to distribute products wider, deeper and faster.
We led two dossiers for speciality products in
Accelerated European revenues in the three years leading to 2012-13
2012-13 (15 dossier lings as on March 31, 2013).
Achievement
We cemented relationships with large and
respected European generic players.

We accelerated European revenues in three
20
% CAGR
years by 20% CAGR upto 2012-13.
Blueprint
We set up an ofce in EU for ling of market
authorisations across European nations

We expect to le about 10 dossiers, largely for
speciality products in Europe

We expect to signicantly increase our product
basket for the European markets.
Stronger focus
To address the needs of a world marked by increasing lifestyle ailments, Alembic evolved its product mix. As human ailments progressively evolved from the acute to the lifestyle, Alembic enriched its product basket with an increasing number of chronic therapies.
Shift
We increased the proportion of speciality
Achievement
Our domestic formulations business grew
products in our product basket from 39% in 2009-10 to about 49% in 2012-13.
We extended our therapeutic coverage
by 15% CAGR in the three years leading to 2012-13; this business grew by 13% (industry average being 10%) during the year under review.
Our speciality business grew by 27%
through the launch of three new divisions in four years (Orthopedic, Ophthalmology and Dermatology).
We accelerated product introduction,
in 2012-13 (industry average 11%); the speciality divisions percentage contribution to overall revenues increased about 500 bps in 2012-13.
adding more than 80 products in the three years leading to 2012-13 (accounted for 15% of the domestic formulation sales); we developed and commercialised in-demand speciality products; four Alembic brands feature among the Top-300 brands launched in the last 12 months (Source: MAT March 2013).
We reinforced and retrained our medical
Blueprint
We plan to strengthen our Specialty
business through selective product portfolio expansion and launching new divisions in the existing specialty segment.
We expect to launch 25 products in 12
months, strengthening our market coverage on progressive molecules.

We intend to widen our therapeutic
representative and eld team, facilitating a deeper domestic penetration.
presence through new divisions.
Strong foundation
Our speciality business growth in 2012-13
27%
Repositioning APIs
Generally in the pharmaceutical industry, the API business is structured to largely support the downstream manufacture of formulations. At Alembic, we walked the road less travelled.
Assured supplies
The percentage of Alembics APIs consumed in-house for value addition into formulations
20
Shift
We widened our API presence, doubled
At the Company, we recognised the need for our API business to emerge integral to our organisational growth engine. So in the space of just three years, we graduated our API business into a core driver of revenues, prots and protability.
Achievement
We increased sales volumes of key APIs
our product basket to 60 APIs and increased our speciality products from ve to 30.
We recognised the need to be present in
(Macrolides and Sartans) by 30-35% over the three years leading to 2012-13.
We improved business protability
large, growing and quality-respecting markets. We increased our presence in the regulated and emerging markets of Europe (East and West), the Middle East, North Africa and Latin America.
We strengthened our product offerings;
considerably in just two years.
Outlook
We are taking our API business ahead
through the commercialisation of 11 speciality APIs in 2013-14.

We expect to add regulated market
we launched nine products in the emerging markets in 2012-13; we led DMFs for six products, growing our presence in regulated markets.
We secured business relations as primary
customers among whom we ourselves positioned as a primary/alternate source for APIs.

We expect to widen our geographic
source/alternate source vendors with more than 20% of our European clients against no such relationships three years ago.
diversication and acquire new clients in emerging markets.
Strength in our numbers 3.23 75 34 8

Percentage of Alembic revenues derived from new products launched in India, 2012-13
2012-13 in retrospect
Domestic formulations
Launched our Dermatology Division in the Commercialised eight ANDAs, received
approvals for seven ANDAs (including one NDA) and led 13 ANDAs during the year
Filed ve ANDAs with TPD, Canada, during
domestic market with eight products

Launched 25 products as line extensions in
existing therapeutic segments

Rekool brands together featured in the
the year
Widened the footprint to more regulated
Top-3 of the Rabeprazole market

Tetan and Tellzy brands together featured in
and emerging markets
Percentage of Alembic exports derived from regulated markets
APIs backed by strong R&D team

Launched 11 new products in the
the Top-3 of the Telmisartan market
International formulations backed by strong F&D team

Received USFDA approvals for an NDA,
domestic and international markets; added new customers
Alembics exports as a percentage of overall revenue, 2012-13
Project management
Part-commissioned a new tableting facility in February 2013
Desvenlafaxine base extended release tablets

Entered into an out-licensing agreement
with Ranbaxy Labs Inc. to exclusively market Desvenlafaxine base ER tablets in the US
Finance
Reduced debt by `16,593 lac
The number of Alembic ANDAs launched in the US market, 2012-13
33 60 49
The number of Alembics ANDAs pending USFDA approval
Speciality therapy performance

Segment Opthamology Cardiology Diabetology Gastroentology Gynaecology Nephrology Orthopedic
Source: MAT March 2013
Industry growth (%) 11 13 23 12 7 16 8
Alembics growth (%) 39 37 41 27 21 45 9
The number of DMFs led by Alembic with USFDA authorities
Percent revenue share of specialty therapy in Alembics formulation business
Our competitive advantages

Rich experience: The Company possesses more than 100 years of experience in the pharmaceutical industry. Vertical integration: The Company is vertically-integrated, which facilitates a seamless value-addition of APIs into formulations. This makes it possible for Alembic to partner global and Indian pharmaceutical players across the value chain. Approvals: The Companys facilities are approved by authorities belonging to the regulated markets, making the products globally acceptable. Geographic diversication: The Company enjoys a footprint across 75 nations (regulated and emerging markets). More than 75% of the export revenue of 2012-13 accrued from regulated markets accompanied by superior realisations, enhanced visibility and greater acceptance in semi-regulated markets. Diligent research: The Companys 300-member research team developed complex products. In 2012-13, the Company launched more than 25 products for the Indian markets and over 20 products for the global markets (regulated and emerging). Regulatory skills: The Companys regulatory skills manifested in the speed with which ANDAs, DMFs and dossiers were led in the last three years, facilitating a strong US and European presence. Brand recognition: The Companys four brands (Azithral, Roxid, Althrocin and Wikoryl) feature among Top-300 pharmaceutical brands. About 10 of the Companys recent launches (24 months) feature among the Top-500 launches of that period. Financial stability: The Company possesses a robust nancial foundation (gearing of 0.37 as on March 31, 2013), making it possible to nance low-cost growth.
Business model
Therapy focus: The Company is focused on expanding its therapeutic presence in high-growth Specialty therapy baskets while maintaining its presence in the Generalised therapy basket, thereby widening the opportunity canvas. Product focus: The Companys product identication strategy revolves around those based on complex chemistry, creating high entry barriers and reducing pricebased competition. Manufacturing focus: The Company focuses on operating its plant at maximum capacity through own manufacturing abilities and catering to specic requirements for large pharmaceutical players, optimising manufacturing costs and xed overheads. Research focus: The Company identies and develops generecisation opportunities, novel drug delivery systems (NDDS), new technology platforms and alternate therapies with speed. These are difcult to develop, marginalising competition clutter. Regulatory focus: The Companys efforts are directed towards undertaking complex regulatory lings in one regulated market and leveraging that across other regulated and emerging markets with suitable modications. Emerging market focus: The Company focuses on widening its presence in select geographies where the product requirement is synergic with the Companys product basket and provides large opportunities.
Ten minutes with the management
Our transformational efforts have only started yielding results. The best is yet to come.
IN ANY BUSINESS, COMPETITIVE ADVANTAGE IS APPRAISED THROUGH THE ABILITY TO REPORT PROFITABLE GROWTH, WHEREBY A PERCENTAGE INCREASE IN REVENUES IS EXCEEDED BY A LARGER PERCENTAGE INCREASE IN PROFITS. THIS REALITY INDICATES AN IMPROVEMENT IN OVERALL COMPETENCE, TRANSLATING INTO SUPERIOR VALUE FOR OUR STAKEHOLDERS.
Business transformation
I am pleased to report that this is precisely what we achieved in 2012-13. Our revenues grew 4%, while our EBIDTA grew 16% and net prot climbed 27% over the previous year. This indicates that we reported an improvement in the quality of our revenues, which immediately translated into higher margins and prots, kickstarting a virtuous cycle that we expect will continue to translate into enhanced organisational value.
Company from being just another player in regulated markets to among the select few to enter segments following genericisation. This is the result: we outperformed the average growth of the domestic formulations segment; we grew our speciality business signicantly higher than the segment average; we enjoy 21-month exclusivity for a product in the US; we transformed from a domestic player into a global pharmaceutical entity.
Overview
The superior results reported by the Company represent an important inection point in the Companys transformation journey that we embarked upon a few years ago. Even as recent as 2009-10, acute therapies dominated our revenue basket. Research efforts were yet to add to the product basket, hence marketing remained a challenge. As a result, global presence was restricted to emerging markets. Gradually, Alembic was yielding its market position. Alembic set out to reinvent its sectoral presence. The Company plugged key senior positions with young professionals. The research and marketing teams worked in tandem. The Company began to address unmet needs. The therapeutic coverage was widened. Complex products with high entry barriers were developed. A new regulatory ling effectiveness graduated the
Strengthening the business

Even as we reported superior numbers in 2012-13, we strengthened the business through various initiatives.
We received the USFDA approval for
our NDA Desvenlafaxine Base Extended Release, a bioequivalent version of the innovator drug Pristiq by Pzer. We engaged Ranbaxy to market this product in the US.
We led two dossiers for complex
products in Europe with high growth potential. We entered into a number of marketing alliances to accelerate sales and make it possible to replace the low-margin contract-manufacturing business with our own protable products.
We established a presence in Australia
(through a subsidiary) to outlicense ready Market Authorisation to multiple customers. As a rst step, we launched two cardiovascular products in the last quarter
We received the USFDA approval for our NDA Desvenlafaxine Base Extended Release, a bioequivalent version of the innovator drug Pristiq by Pfizer. We engaged Ranbaxy to market this product in the US.
We increased our ANDA filings of complex products where the returns shall justify the development and filing expenses; we hope to continue to work on such opportunities over the medium-term. We expect to launch 8-10 products in 2013-14.
of 2012-13. We started lings in Brazil, which should generate attractive revenue next year.
We led new product registrations
additional business shall replace our lowmargin contract manufacturing business, expanding margins. Other markets: We plan to le about ve or six dossiers in Brazil in 2013-14. We expect to establish an ofce in Brazil to accelerate lings and provide ready dossiers to customers. In line with a need for wider and deeper marketing initiatives, we invested `11,000 lac and commissioned a new formulations unit, increasing our annual tablet manufacturing capacity to 5 billion. As a result of these initiatives, we expect Alembic to generate an annual revenue increment of 30-35% per annum over the next two years and emerge as an increasingly global organisation.
APIs
In the API business, we intend to exit low margin products and graduate to new protable products with sizeable potential. This strategy has been vindicated through our growing product development volumes: we generated revenues of `2,500 lac in 2012-13 from the sale of development quantities to clients against less than `500 lac from this segment a couple of years ago, showcasing our ability to develop new products in line with evolving client requirements. We also secured approvals from large global formulators as the primary/secondary API source, which should generate attractive returns going forward.
in Ukraine, Vietnam, Uganda and Kenya for branded formulations, which should translate into revenues starting 2013-14. These initiatives will increase and broadbase global revenues, de-risking the Company from an overdependence on a single geography.
Going ahead
In the pharmaceutical industry, success gravitates to companies that extend from relatively simple and crowded product spaces towards complex niche marked by higher product realisations. At Alembic, we expect to accelerate our growth through the following initiatives:
Message to shareholders
The message that I want to send out is that Alembic is a transformed company with the rst visible signs of this positive change reected in its nancials and prospects of better days ahead as the Companys volume-value strategy plays out across markets. We are optimistic that this interplay will translate into superior value in the hands of all those who own shares in our Company.
Branded formulations
India: We are building on our robust Indian foundation through the proposed launch of more than 20 products a year, comprising line extensions in existing therapeutic segments and addition of new therapeutic segments. In 2013-14, we expect to reinforce our position in the gastroenterology space.
International generics
The US: We increased our ANDA lings of complex products where the returns shall justify the development and ling expenses; we hope to continue to work on such opportunities over the medium-term. We expect to launch 8-10 products in 2013-14. Europe: We intend to increase the number of dossiers led from two in 2012-13 to 10 (all complex products) in 2013-14 and emerge as the only generic player in Europe for a particular product. The
Emerging markets: We made signicant inroads in emerging markets, ling more than 20 dossiers in South East Africa, Africa and CIS nations and expect these efforts to yield results by end-2014. Chirayu Amin Chairman and Managing Director Warm regards,
Transformation in Indias aliment matrix

Most notable among these ailments will be those under the broad umbrella of metabolic disorders. India is already home to the largest diabetic population in the world. The prevalence of diabetes is expected to rise from 2.8% in 2005 to 3.7% in 2015; cornonary heart disease from 3.3% to 4.9%; obesity from 1.3% to 2.7% (Source: McKinsey)
Rapid Growth in Prevalence of Several Chronic Diseases Prevalence rates of key chronic diseases in India Per cent of population
4.91 3.70 2.80 2.50 2.70 1.30 0.18 Coronary heart disease Number of patients (million) 36 62 Diabetes Asthma Obesity 0.20 2.70 India (2005) India (2015)
3.31
Cancer
31
46
27
34
14
34
2.0
2.5
Source: NCMH background papers, 2005; Central Bureau of Health Intelligence; Who; Decision Resources: McKinsey analysis
Generics driving the global pharmaceutical industry

The expiry of patents on the one hand and a need to reduce healthcare spends are likely to drive the growth of the generics market in developed countries, while the need for affordable treatment will enhance generics usage in developing markets.
Generics driving growth
The global spending on generics accounts for 25% of the global pharmaceuticals spending (US$242 billion in CY11), growing rapidly in the last few years (~12% CAGR over CY06-11). This generics segment is expected to increase from US$242 billion to US$400-430 billion by 2016, of which US$224-244 billion of the increase is likely to come from low-cost generics in pharmerging markets. The global spending on generics (ex-India) is expected to grow faster (11% CAGR to US$386 billion) compared to the overall global spending on medicines. The share of the top 10 Indian players is merely 1.1% of the total spending (~US$11 billion) and 3.3% of the generics spending (US$7.4 billion; ex-India), indicating attractive room for growth. Globally competitive business models with a mere 3.3% share of the addressable market combine to provide a large and sustainable opportunity for Indian pharma companies.
Pharmerging 56.0% RoW 14.9% Developed 29.1% Generics spending CY16E US$415 billion
Global Pharma spending (US$ billion) 1,200 1,100 1,000

956 34 27 173 1,190
Estimated growth CAGR over CY11-16E (%) Total Generic spending RoW 6.8 11.4
Pharmerging
16.2
900 800 Developed

Global spend CY11 Branded Generic Others Global spend CY16E
6.7 0 5 10 15 20
Analysis of the financial statements

Despite a challenging 2012-13, when India reported its slowest economic growth in a decade, we delivered superior numbers.
A. Analysis of the Statement of Prot and Loss Net sales
Net sales increased from `1,46,235 lac in 2011-12 to `1,51,725 lac in 2012-13. The increase is due to the volume-value play from business transformation into niche therapeutic segments and complex products.
Net sales
International Generics Growth over 2011-12: 6.65% Contribution to topline: 18.34%
Domestic Formulations Growth over 2011-12: 13.24% Contribution to topline: 58.08%
APIs Growth over 2011-12: (6.13)% Contribution to topline: 22.97%
International Generics: While the business was at a similar level as the previous year, the quality of business improved signicantly. The dossier approvals, product launches and commissioning of new capacity in 2012-13 is expected to increase business volumes over the coming years. Domestic Formulations: The Companys business outperformed the average industry growth. This was possible due to the teams focus on the specialty business the product basket was strengthened and marketing efforts were intensied which more than made up for the marginal growth in the acute business. The new product launches are also expected to accelerate growth over the coming years.
APIs: The Companys successful product launches in regulated and emerging markets, its widening geographic presence and deeper penetration in existing geographies catalysed growth and protability over the previous year.
The key contributors to the cost increase comprised:

Employee expenses expanded due to an
increase in people to manage the growing business and increased emoluments and benets.
Other expenses - primarily travelling
Cost analysis
Despite persistent inationary headwinds, increasing fuel price hikes and high interest cost, Alembic capped its operating costs increase at only 7% operating costs moved up from `47,947 lac in 2011-12 to `51,404 lac in 2012-13. Wastage elimination, cost optimisation and productivity enhancement facilitated an increase in business margins.
expenses, sales and marketing expenses and power costs. Travelling expenses spiraled as a result of intensied marketing which resulted in a growing business. The power cost increase was consequent to increasing power tariff and growing production volumes.
R&D expenses increased by 26% from
`5,858 lac to `7,363 lac in line with
EBIDTA margin (%)

16.79 15.06
Net prot margin (%)

10.84
Interest cover (x)

15.16 2.46 5.47 FY12 7.14 FY10
13.34
10.23
3.46
7.10
8.87
FY10
FY11
FY12
FY13
FY10
FY11
FY12
the managements focus on working on complex chemistries and challenging processes to develop niche products. The increase in operational costs was negated to some extent due to the following reasons:
A reduction in the cost of materials
consumed due to a change in the product mix and efcient negotiations with suppliers
A reduction in the Companys interest
FY13
Margins
Increasing sales volume of speciality products in the domestic markets, increased product sales in lucrative regulated markets and cost containment measures contributed to a stronger EBIDTA margin; a signicant decline in the interest liability strengthened the Companys net margin.
liability due to debt repayment and reduction in the average interest cost of borrowings
31.40 %
Return on capital employed, 2012-13
66.63%
Proportion of net profit transferred to Reserves and Surplus, 2012-13
FY11
FY13
B. Analysis of the Balance Sheet

Over the years, the Company adopted a prudent strategy of balancing shareholder rewards with the need to re-invest business surplus and sustain growth momentum. March 31, 2013 due to a plough back of 66.63% of the net prot earned in 2012-13. The entire reserves were free reserves which can be deployed by the Company to fund various initiatives. The book value per share strengthened from `20.95 as on March 31, 2012 to `29.60 as on March 31, 2013.
Tangible assets
Net tangible assets grew 28.53% from `26,782.19 lac as on March 31, 2012 to `34,422.15 lac as on March 31, 2013 due to investments in a formulation unit and routine capital expenditure.
Capital employed
The total capital employed in the business (networth and external liabilities) remained almost at at `75,876 lac. This was due to an accretion of the reserves and surplus balance, which was offset by a decline in long-term debt and decrease in current liabilities. Accurate strategic direction and timely execution ensured that capital infused in the business was prudently utilised. Return on capital employed climbed by 668 bps from 24.72% in 2012-13 to 31.40% in 2012-13.
Inventories
An increase in operational scale resulted in an increase in inventory at the year-end. The balance of raw material inventory increased primarily due to a widening of the product basket and increased product ling in regulated and emerging markets. Finished goods inventory declined considerably, reecting faster product offtake and superior inventory management. The average inventory cycle stood at 75 days of turnover equivalent.
Long-term borrowings
Long-term borrowings declined sharply from `21,428 lac as on March 31, 2012 to `11,667 lac as on March 31, 2013. Longterm debt primarily comprised foreign currency loans from bank.
Short-term borrowings
The segment primarily comprised secured and unsecured working capital limits from banks to fund day-to-day activities. Despite increased business volumes and widened business presence, the Company reduced its reliance on external working capital nancing. As a result, the balance under this head declined from `13,843 lac as on March 31, 2012 to `7,011 lac as on March 31, 2013.
Shareholders funds
Shareholders funds increased 27.39% from `39,500 lac as on March 31, 2012 to `50,294 lac as on March 31, 2013 owing to an increase in reserves and surplus. While the Companys equity capital remained unchanged, the reserves and surplus balance grew 30.33% from `35,183 lac as on March 31, 2012 to `45,854 lac as on
Trade receivables
A sizeable increase in sales volumes and a widening distribution network resulted in an increase in outstanding receivables at the year end they grew 16.82% from `19,933.11 lac as on March 31, 2012 to `23,287.08 lac as on March 31, 2013. Average receivables stood at 56 days.
ROCE margin (%)

31.40
ROE (%)
33.41 33.30 1.21 28.92
Debt-equity (x)
1.11
24.72
20.75
9.72
11.69
0.89
FY10
FY11
FY10
FY11
FY12
FY13
FY10
FY12
FY13
FY11
FY12
FY13
0.37
Managing business uncertainties

Man cannot discover new oceans unless he has the courage to lose sight of the shore.- Andre Gide
Risk is the face of business uncertainty, affecting corporate performance and prospects. As a diversied enterprise, Alembic has a systems-based approach to risk management. A combination of centrally-issued policies and divisionally-evolved procedures brings robustness to the process of risk management. The senior management periodically reviews the risk management framework to maintain contemporariness and address emerging challenges in a dynamic environment. This prudently balances risk and reward leading to shareholder value growth.
1 2
The pharmaceutical industry remained largely unaffected by the economic slowdown, especially critical therapies. Alembic diversied its global presence across regulated and emerging economies, making it possible to sustain growth despite short-term slowdowns in any geography.
Besides, Alembics focus on commercialising products in emerging therapeutic areas translated into industry out-performance. The Company focused on widening its product basket and increasing product registrations, as a result of which growth is expected to accelerate.
The global economic slowdown could affect the Companys growth momentum.
The Company engaged in regulatory lings for multiple product launches across geographies. The Companys ling quality continued to be at par with leading Indian pharmaceutical companies. The recent USFDA approval for its NDA Desvenlafaxine base product in a period
of 10 months stands testimony to this capability. Besides, much of the projected growth is expected to be derived from products launched or approved in the later part of 2012-13 in key global pharmaceutical markets.
The Companys planned launches could be delayed, impacting growth and protability.
3 4 5
The Companys 300-member R&D team accelerated the development of complex products. This reected in the transformation of Alembics product basket for all markets APIs, branded formulations and international generics (discussed in an earlier section of this report). The
team is working on a robust pipeline of complex products expected to lose patent protection between 2017 and 2020. An in-licensing agreement with Accu-Break Pharmaceutical Inc. for a novel technology will strengthen the Companys product pipeline.
A limited product pipeline could impact the Companys medium-term growth.
The pharmaceutical industry in general carries the risk of not receiving regulatory approvals from time to time. The Companys QA/QC and regulatory teams continuously work towards upgrading its infrastructure, systems and process and quality standards to match the stringent guidelines stipulated by the authorities in
regulated markets approvals for its facilities from key regulated markets vindicates the Companys commitment to match global standards. Besides, the Companys expansion being browneld in nature is not hinged on additional regulatory approvals derisking its business plans.
Extended time to secure regulatory approvals could hamper the Companys numbers.
The drug pricing regulator National Pharmaceutical Pricing Authority (NPPA) issued a notication to regulate prices of 150-odd essential medicines, which include painkillers, anti-infectives, antibiotics and anti-cancer, gastrointestinal medicines,
anti-diabetic and cardiovascular drugs. The Companys efforts in increasing its presence in the speciality segment in India and global markets primarily regulated markets will help sustaining margins.
The risk and uncertainty over the Pharmaceutical Policy and xation of ceiling prices for products in the market remain a risk.
Internal Control Systems and Adequacy

The Company maintains a system of well-established policies and procedures for internal control of operations and activities. The internal audit function is further strengthened in consultation with statutory Auditors for monitoring statutory and operational issues. The Company has appointed M/s. Sharp & Tannan, Chartered Accountants, as Internal Auditors. The prime objective of this audit is to test the adequacy and effectiveness of all internal control systems and suggest improvements. Signicant issues are brought to the attention of the Audit committee for periodical review. Moreover, the Company has obtained ISO 9001 and ISO 14001 certication and adheres to the Standard Operating Practices in its manufacturing and operating activities.
Human Resource Intervention in 2012-13

Reinforcing performance-based orientation and building human capital have been the focus of the Company during the year under review. Efforts at improving effectiveness and efciency of the employees without losing the human sensitivity has been a roadblock which has been successfully navigated past during this period. Cutting across businesses and levels, your Company has been able to permeate the overall objective towards aligning the employees efforts and stakeholders expectations. Periodic reviews and corrective measures were undertaken primarily to encourage and direct employees. To institutionalise the performance-based orientation, the rewards have been directly aligned to contribution and performance.
Health, safety, security and environment

Health, safety, security and environment form the core of our business and all employees are accountable for the maintenance of the above. Alembic follows industry- best practices as regards to health, safety, security and environment. During the year under review, safety audits were carried out by third party representatives and all observations/suggestions were implemented. Environmental audits (Statutory) were carried out and submitted to the pollution control boards for their review. Waste generation was reduced by improving chemical processes at various stages.
Contribution to society
Alembic is committed to enhance the quality of life in and around the communities of its presence. During the year under review, the Company undertook a number of development projects focusing on health, education and vocational training. The Company manages a rural development society since 1980. This is located near Panelav in the foothills of Pawagadh. Its objective is to enhance self-employment capabilities through vocational training and education for adults and children across 50 villages.
Directors Report
To the Members,
Your Directors have pleasure in presenting their 3rd Annual Report together with the Audited Statement of Accounts for the year ended on 31st March, 2013.
1. Financial Results:
Stand Alone Basis 2013 2012 24,769 21,001 1,457 3,496 96 3,975 15,745 5,363 21,108 4,713 801 8,000 7,594 2,621 3,365 (38) 3,000 12,054 2,168 14,222 792 2,639 428 5,000 5,363 Particulars For the year ended 31st March Prot for the year before Interest, depreciation and Tax Adjusting therefrom: Interest (net) Depreciation Provision for deferred tax liabilities or (assets) Provision for current tax and wealth tax Net Prot Adding thereto: Balance brought forward from previous year The amount available is Appropriating there from: Debenture Redemption Reserve Provision for Dividend - Equity Shares Provision for Corporate Dividend tax Transfer to General Reserve Balance carried forward to Balance Sheet H in lacs Consolidated Basis 2013 2012 25,590 22,085 1,457 3,497 96 4,014 16,525 8,230 24,755 4,713 801 8,000 11,241 2,621 3,365 (38) 3,123 13,013 4,076 17,089 792 2,639 428 5,000 8,230
2. Dividend:
Your Directors have recommended Dividend on Equity Shares at H 2.50 per share (i.e. 125 %) of face value of H 2/- per share for the year ended on 31st March, 2013 as against H1.40 per share (i.e. 70 %) for the year ended 31st March, 2012.
4. Operations:
The Companys Standalone revenues from operations were H1,492.62 Crores for the year ended 31st March, 2013 as compared to H1,374.30 Crores for the previous year. The standalone prot before Interest, Depreciation, Nonrecurring Income and expenses and Taxes was H 243.76 Crores for the year under review as compared to H 208.59 Crores for the previous year. During the year, the interest and nancing cost was H14.57 Crores as compared to H 26.21 Crores in previous year. The Company has registered consolidated revenues from operations of H1,520.34 Crores for the year under review as compared to H1,465.41 Crores for the previous year.
3. Managements Discussion and Analysis:

The Report on Management Discussion and Analysis as required under the Listing Agreements with the Stock Exchanges given elsewhere in the report. Certain statements in this section may be forward-looking. Many factors may affect the actual results, which could be different from what the Directors envisage in terms of the future performance and outlook.
Directors Report
The break-up of consolidated sales excluding export incentives and other misc. revenues is as under: Particulars Domestic Formulation Export Formulation Domestic API Export API Total F.Y. 2012-13 886.27 279.89 113.82 236.74 1,516.72
H in Crores F.Y. 2011-12 782.61 298.50 94.24 279.22 1,454.57
deposit of H 500 /- from a member, proposing his candidature as director, liable to retire by rotation. In accordance with the provisions of the Companies Act, 1956 and Articles of Association of the company, Mr. Paresh Saraiya and Mr. Milin Mehta, Directors of the Company will retire by rotation at the ensuing Annual General Meeting who are eligible for re-appointment. Brief resumes of Mr. Shaunak Amin, Mr. Paresh Saraiya and Mr. Milin Mehta are given in the Corporate Governance Report.
The consolidated Prot, before providing for Interest, Depreciation, Non-recurring Income, expenses and Taxes, was H 251.96 Crores for the year under review as compared to H 219.43 Crores for the previous year. The Company has made a consolidated prot after tax of H165.25 Crores for the year under review as compared to H130.13 Crores for the previous year.
8. Energy, Technology and Foreign Exchange:

In accordance with the provisions of Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, the relevant information pertaining to conservation of energy, technology absorption, foreign exchange earnings and outgo is given in Annexure - A to this report.
5. Listing of shares:
The Equity shares of the Company are listed on The Bombay Stock Exchange Limited (BSE) with scrip code No. 533573 and on National Stock Exchange of India Limited (NSE) with scrip code of APLLTD.
9. Particulars of Employees:
The information required under section 217(2A) of the Companies Act, 1956, read with Companies (Particular of Employees) Rules, 1975, forms part of this report as Annexure-B. However, as permitted by section 219(1)(b)(iv) of the Companies Act, 1956, this Annual Report is being sent to all shareholders excluding this Annexure. Any shareholder interested in obtaining the particulars may obtain it by writing to the Company Secretary of the Company.
6. Fixed Deposits:
The Fixed Deposits including those from shareholders as on 31st March, 2013 was H3,571 Lacs. There were unclaimed deposits amounting to H48.03 Lacs from 128 deposits holders which have been transferred to current liabilities. Out of this, no deposits have since been repaid or renewed at the option of depositors and no instructions have been received so far and if not claimed in future, it shall be deposited in the Investor Education and Protection Fund in due course, as per the provisions of the Companies Act, 1956.
10. Corporate Governance:

Your Company has complied with all the provisions of Corporate Governance as prescribed under the amended Listing Agreements of the Stock Exchanges, with which the Companys shares are listed. A separate report on Corporate Governance is produced as a part of the Annual Report, along with the Auditors Certicate on the compliance. As required vide clause 49 of the listing agreement on Corporate Governance, the board has laid down a code of conduct for all members and senior management team of the Company. The said code of conduct has been posted on the website of the
7. Directors:
The Board of Directors at its meeting held on 2nd May, 2013 has appointed Mr. Shaunak Amin as Additional Director and Director & President Branded Formulations Business. Mr. Shaunak Amin holds Directorship upto the date of ensuing Annual General Meeting. The Company has received a Notice under Section 257 of the Companies Act, 1956, together with
Directors Report
Company www.alembic-india.com. All Board members and senior management personnel of the company have afrmed the requirements of the said code of conduct. practices which enables it to attract and retain potential talents. Employee relations in your Company continues to be cordial and harmonious.
11. Audit Committee:

The Audit Committee consists of Mr. Paresh Saraiya, Mr. Milin Mehta and Mr. Pranav Parikh. Mr. Paresh Saraiya is Chairman of the Audit Committee. All the Directors in Audit Committee are Non-Executive Independent Directors. The Committee reviewed the Internal Control System, Scope of Internal Audit and compliance of various regulations.The Committee reviewed at length the Annual Financial Statements and approved the same before they were placed before the Board of Directors.
15. Directors Responsibility Statement:

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, with respect to Directors Responsibility Statement, it is hereby conrmed: (i) that in the preparation of the annual accounts for the nancial year ended 31st March, 2013, the applicable accounting standards have been followed along with proper explanation relating to material departures; (ii) that the Directors have selected appropriate accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the nancial year and on the prot of the Company for the year under review; (iii) that the Directors have taken proper and sufcient care
12. Auditors:
M/s. K. S. Aiyar & Co., Chartered Accountants, Statutory Auditors, will retire at the conclusion of the ensuing Annual General meeting and are eligible for re-appointment as Auditors. Members are requested to re-appoint them and authorise the Board of Directors to x their remuneration. The Company has appointed M/s. Sharp & Tannan, Chartered Accountants as its Internal Auditors to carry out the Internal Audit of various operational areas of the Company.
for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and (iv) that the Directors have prepared the annual accounts for the nancial year ended 31st March, 2013 on a going concern basis.
13. Cost Auditors:

As per the order No. 52/26/CAB/2010 dated 2nd May, 2011 of the Ministry of Corporate Affairs, the Company is required to get Audited, the Cost Accounts maintained by the Company relating to Bulk Drugs and Formulations for the year ended on 31st March, 2013 by Auditors with qualication prescribed in Section 233B(1) of the Companies Act, 1956. Accordingly, the Board had appointed Mr. H. R. Kapadia as Cost Auditor for the year ended on 31st March, 2013.
On behalf of the Board of Directors,
Chirayu R. Amin
14. Human Resource Management:

Human capital has always been the most important and valuable asset to your Company. Your Company has enhanced its performance management process that motivates people to take ownership of their own performance and encourages innovation and meritocracy. Your Company has created people
Chairman & Managing Director 2nd May, 2013
ANNEXURE A
Particulars required under the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988.
(a) Energy Conservation measures during the year under review 1) Effective Load balancing exercise. 2) Increasing awareness about the lighting and other equipment and need base utilisation. 3) Extensive use of VFDs on pumps. 4) Controlling operations of the HVAC resulting in power saving. 5) Avail cheaper power through power purchase from IEX. (b) Additional Investment Proposals for Reduction of Consumption & Cost of Energy. The Company continuously endeavors to discover usages on new technologies and tools to save the energy and reduce consumption and cost of Energy. (c) Impact of Measures at (a) & (b) above for reduction of energy consumption & consequent impact on the cost of production of goods. 1) Reduction in overall consumption of Electricity. 2) Saving of Chemicals used for treatment of water. 3) Reduction in HSD consumption by 6-7 Litres/Hr. For the period ended on 31st March, Income Export (FOB basis) Royalty Expenditure Raw Materials (CIF basis) Packing Material, Components and Spare Parts (CIF basis) Professional and Consultancy fees Interest Others 2013 Form B enclosed. 1. The Export sales were H 465.02 Crores (FOB) during the year under review.The Company has undertaken aggressive marketing strategies to increase share of export business. 4) Efuent Treatment Plant load reduced by reutilisation of Puried Water and Steam condensate. 5) Saving in power cost. Efforts made in technology absorption:
2. Total Foreign exchanges used and earned: H in lacs 2012
46,501.58 1,521.68 15,541.82 908.97 364.40 215.68 4,958.85
46,795.60 1,160.44 18,631.48 218.03 338.32 54.60 3,502.28
Form A
Form for disclosure of particulars with respect to conservation of energy.
A. Power and Fuel Consumption:

For the year ended 31st March 1. Electricity : (a) Purchased Units (KwH) Total Amount H Rate (H/Unit) (b) Own Generation : (i) Through diesel generator : Units (KwH) Units per litre of diesel oil Cost (H/Unit) 2. Furnace Oil Qty. (K.Ltrs.) Total Amount H Average Rate (H/KL) Bio Mas Qty.(in Kgs) 2012-13 3,11,87,321 16,76,04,358 5.374 2011-12 3,13,18,888 19,51,34,869 6.231
4,13,494 3.29 12.13 843.684 3,42,01,089 40,538 53,91,012 3,74,67,351 6.95
4,64,181 3.29 10.95 1,107.096 4,08,77,288 36,923 59,50,448 3,25,08,469 5.46
Average Rate (H/Kg)
B) Consumption per unit of production

In view of the number of products, with different sizes, shapes and other parameters, being manufactured by the Company, it is not feasible to give information on consumption of fuel per unit of production.
Form B
Form for disclosure of particulars with respect to technology absorption, etc. f) With increase in thrust on cost optimisation, at Alembic Research Centre, scientists have focused on specic cost reduction projects for the molecules which are already generic in the regulated market, which has experienced a price erosion. g) Technology for new products have been developed at the lab scale and also on the synthetic front; scale-up and commercial production of Donepezil, Duloxetine, d) Microbial Research e) BE Studies f) Focusing on process development for improving operational efciency. Aripiprazole, Memantine, Fenobrate Choline Salt and Quetiapine have been completed during the year. h) The company has marked its presence in Europe by launching the drug products like Losartan, Losartan and Hydrocholrtiazide and Pramipexole for the various customers. i) High specialty Ophthalmic range has been introduced in Ophthalcare Division in the domestic market. We have been leveraging the R & D strength as a strong player in the domestic formulations.
A) Research and Development (R&D)

1. R&Ds focus areas
a) Development of Generic Drugs b) Collaboration with National Universities and Institutes c) Formulation Development
2. Benets derived as a result of R&D

a) The Company led 13 ANDAs and 6 DMFs in this scal year. The cumulative ANDA lings stood at 57 and 23 approvals have been received till 31st March, 2013. b) The Company received its rst NDA approval in January, 2013. c) Our endeavour to expand our product pipeline and the tenacity of purpose has established itself making us a strongly research-driven Organisation. d) Till date 534 patents for Active Pharmaceutical Ingredients (APIs) and Intermediates as well as 228 patents for formulations have been led. e) The Company has developed the skill set to create a wide range of pharmaceuticals across the value chain from complex APIs to Formulations.These projects typically work with a lead time of a few years, and power our growth plans across the world. We have close to 300 scientists working across two development centers.
3. Future plan of action

a) Focused Research & Development activities will result in increased ling of ANDA and DMF. b) The Company will extensively upgrade with latest technologies thus strengthening its R&D product pipelines for USA, Europe and other regulated and semi regulated markets across the globe, more emphasis shall be laid on sustained and modied release dosage forms. c) The nished dosage forms cover a wide range of therapeutic categories reecting on the very active research pursuits of our dedicated and skilled professionals. The aim here is to emphasise innovation and quality which is at the heart of Alembics Research efforts.
Form B
4. Expenditure on R&D
a) b) c) d) Capital Recurring Total Total R&D expenditure as a percentage of total turnover 2013 264 7,363 7,627 5.02 H in lacs 2012 507 5,858 6,365 4.63 New process developed using innovative technologies in products such as (i) Ivabradine (ii) Fesoterodine, (iii) Amorphous Warfarin Sodium and certain cost reduction processes such as Azithromycin Dihydrate and Pramipexole testify to the intensive pursuit of technological excellence at Alembic. 2) Benets derived 1) Reduction in cost of production for some of the revenue driven molecules such as Azithromycin, Clarithromycin, Roxythromycin, Ropinirole, Pramipexole, Leunomide etc. 2) A radically new process which enabled multiple fold increase in yield of Fesoterodine A process which has been led patent for. 3) Increasing the production efciency and consistency in the manufacturing cycle. 4) Information regarding technology imported during last ve years. Nil.
Adaptation and Innovation

1) Efforts made towards technology absorption, adaptation and innovation Technological Innovation has become increasingly critical for rms as they struggle to achieve and maintain competitive advantage. Trends such as fast product-cycle times, greater competition/ product commoditisation and technology fusion have only added importance for innovation. The foundation of competitive advantage in the pharmaceutical industry lies in successful innovation. The Pharmaceutical industry spends more as a percentage of sales on Research and Development than any other industry We at Alembic have chosen to develop same the techno sensitive niche products which offer high value advantage. Further, we have a special technology transfer team which has helped us in smooth transfer of the technology from lab to plant for which is reecting in the highest number of DMF ling for the year.
Report on Corporate Governance

1. Companys Philosophy
Corporate governance is about commitment to values and ethical business conduct. It is about how an organisation is managed. Timely and accurate disclosure of information regarding the nancial situation, performance, ownership and governance of the Company is an important part of corporate governance. This improves understanding of the structure, activities and policies of the organisation and enhances the trust and condence of the stakeholders. The Company has always been committed to the principles of good corporate governance. Alembic, while striving to achieve nancial targets, seeks to follow the business principles and ethics in all its dealings and believes in customer orientation, teamwork, commitment, growth and trust as its corporate values. The Board of Directors strives to represent the shareholders interest to ensure optimal returns. At the same time, it is also responsible to all the other stakeholders including customers, employees, suppliers and to the communities where it operates. Alembic aims to deliver customer satisfaction by developing and maintaining mutually benecial and long lasting relationship with customers, offering value in terms of price and quality and responding to customers needs through continuous innovation. Alembic endeavors to make its management team fully empowered to take the Company forward within the framework of effective accountability, which in turn enables the conversion of opportunities into achievements for the Attendance of the Director at the Board Meetings and at the last AGM and Number of other Public Limited Companies in which the Director is a Director / Committee Member
No. of Board Meetings held & attended during the Financial Year 4 of 4 4 of 4 Attendance at the last AGM Yes Yes No. of other Directorships (excluding Directorships in foreign & Private Companies) 10 1 No. of Committees Membership / Chairmanship As Chairman 1 As Member 2 1
betterment of the Company and its stakeholders. The Board has also institutionalised best management practices to bring about an atmosphere of accountability. Systems are being put into place to ensure effective strategic planning, optimum risk management, nancial plans and budgets, integrity of internal controls and reporting, communication policy with emphasis on transparency and full disclosure on the various facts of the Companys operations, its functioning and its nancial and total compliance with all statutory / regulatory requirements not only in the letter of the law but also in its spirit.
2. Board of Directors
Composition of the Board The Board of Directors has optimum combination of Executive and Non-Executive & Independent Directors. During the year under review and as on date of this report, the Board meets the requirement of having at least 50% of the Board strength consisting of Independent Directors as 4 out of 8 Directors are Non-Executive Independent Directors (50% of the Board Strength). Number of Board Meetings held and the dates of the Board Meetings Four (4) Board Meetings were held during the year ended 31st March, 2013 on 25th April, 2012, 9th August, 2012, 19th October, 2012 and 21st January, 2013.
Name of Director
Category
Mr. C. R. Amin Chairman & Managing Director Mr. Pranav Amin Director & President International Business Mr. R. K. Baheti Director-Finance & Company Secretary Mr. K. G. Ramanathan Mr. Pranav Parikh Mr. Paresh Saraiya Mr. Milin Mehta
Promoter Executive Promoter Executive Executive
4 of 4
Yes
NED (I)* NED (I) * NED (I) * NED (I) *
3 of 4 1 of 4 4 of 4 4 of 4
No No Yes Yes
1 4 1
1 3 2
1 1 1
* NED(I) means Non-Executive- Independent Director


2. Board of Directors - Contd.
As required by the Companies Act, 1956 and clause 49 of the listing agreement, none of the Directors hold Directorship in more than 15 Public Companies, membership of Board Committees (Audit & Investor Grievance Committees) in excess of 10 and Chairmanship of Board Committee in excess of 5. None of the non-executive Directors has any pecuniary relationship or transactions with the company and its associates except Mr. Milin Mehta where the Companys associates have paid H4.00 lacs to M/s. K. C. Mehta & Co. Chartered Accountants as fees for professional services provided by the rm to the Companys associates. Mr. Milin Mehta, a Director of the Company is partner of the said rm. The Board does not consider the rms association with the Companys associates to be of a material nature so as to affect independence of judgment of Mr. Milin Mehta as a Director of the Company. Code of Conduct The Board has adopted code of conduct for all Board Members and Senior Management of the Company vide resolution dated 31st March, 2011 and the said code of conduct is posted on the web site of the Company (www.alembic-india.com)A declaration signed by the Chairman & Managing Director on behalf of the Board of Directors is given below: Mr. Pranav Parikh We hereby conrm that: As provided under Clause 49 of the Listing Agreement with the Stock Exchanges, all Board Members and Senior Management Personnel have afrmed compliance with the code of conduct of the Company for the year ended 31st March, 2013 and the copy of the code of conduct is put on the website of the Company viz www.alembic-india.com On behalf of the Board of Directors Chirayu R. Amin Chairman & Managing Director CEO/CFO Certicate As required under Clause 49 (V) of the Listing Agreement with the Stock Exchanges, the Managing Director & DirectorFinance of the Company has certied to the Board the nancial statements for the year ended 31st March, 2013. Mr. Milin Mehta
3. Audit Committee
Composition & Terms of Reference The Audit Committee comprises of 3 Directors viz. Mr. Paresh Saraiya, Mr. Pranav Parikh and Mr. Milin Mehta. Mr. Paresh Saraiya is Chairman of the Audit Committee. All the Directors in Audit Committee are Non-Executive Independent Directors. The terms of reference of the Committee are wide enough to cover the matters specied for Audit Committee under the Listing Agreements. The Statutory Auditors, Internal Auditors, Cost Auditors and other relevant persons of Finance Department are invited to attend the Meetings of Audit Committee. The Company Secretary acts as Secretary to the Committee. Mr. Paresh Saraiya, Chairman of Audit Committee was present at the last Annual General Meeting held on 9th August, 2012. Meetings and the attendance during the year There were Four (4) meetings of the Audit Committee during the year held on 24th April, 2012, 9th August, 2012, 19th October, 2012 and 21st January, 2013. The attendance of each member of the Committee is given below: Name of Director Mr. Paresh Saraiya Category of Director No. of Meetings Attended Non-Executive 4 Independent Non-Executive 4 Independent Non-Executive 1 Independent
4. Remuneration Committee
The Board of Directors at its meeting held on 31st March, 2011, has constituted Remuneration Committee of Directors consisting of Mr. K.G. Ramanathan, Mr. Pranav Parikh, Mr. Paresh Saraiya and Mr. Milin Mehta to x and nalise the remuneration of Managerial Personnel. Mr. K.G. Ramanathan is Chairman of the Remuneration Committee. Meetings and the attendance during the year: No meeting of remuneration committee was held during the Financial Year 2012-13. Details of Remuneration paid to Directors a. Executive Directors All elements of remuneration package i.e. salary, benets, bonus, pension etc. paid to Executive Directors during the Financial year are as under:

Name & Designation of Executive Director Mr. Chirayu Amin, Chairman & Managing Director Mr. R.K. Baheti, Director-Finance & Company Secretary Mr. Pranav Amin, Director & President-International Business Total Salary & Perquisites 299.84 176.01 234.55 710.40 Commission 741.34 741.34 H in lacs Total 1041.18 176.01 234.55 1451.74
Notes: a. Mr. C.R. Amin, Chairman & Managing Director: Appointed for a period of 5 years w.e.f. 1st April, 2011. b. Mr. R.K. Baheti, Director Finance & Company Secretary: Appointed for a period of 5 years w.e.f. 1st April, 2011. c. Mr. Pranav Amin, Director & President-International Business: Appointed for a period of 5 years w.e.f. 1st April, 2011. d. There is no provision for payment of severance fees. e. The Company does not have any Stock Options Scheme. The Board of Directors of the Company has recommended a revision in remuneration payable to Mr. Pranav Amin, Director & President International Business w.e.f. 1st April, 2013 subject to approval of Shareholders at the ensuing Annual General Meeting. The details of the same are provided in the notice convening the AGM. b. Non-Executive Directors Non Executive Directors are paid sitting fees of H 20,000/for attending Board and Committee Meetings.The Details of sitting fees paid to the Non Executive Directors during the Financial Year 2012-13 are as under: Name of Director Sitting Fees Sitting for Board Fees for Meetings Committee Meetings (D) (D) Mr. K.G. Ramanathan Mr. Paresh Saraiya Mr. Milin Mehta Mr. Pranav Parikh 60,000 80,000 80,000 20,000 3,40,000 1,00,000 20,000 60,000 4,20,000 Mr. Paresh Saraiya 1,80,000 40,000 Mr. Pranav Amin Mr. Pranav Parikh Total Fees Paid (D)
5. Shareholders / Investors Committee

The Shareholders/Investors Committee comprises of 3 Directors viz. Mr. Paresh Saraiya, Mr. Pranav Parikh and Mr. Pranav Amin. Mr. Paresh Saraiya is Chairman of the Shareholders/ Investors Committee. Meetings and the attendance during the year Twelve (12) meetings of Shareholders/Investors Committee were held during the year ended 31st March, 2013. The attendance of each member of the Committee is given below: Name of Director Category of Director Non-Executive Independent Executive Non Independent Non-Executive Independent No. of Meetings Attended 12 12 -
The Board has also proposed the following commission to Non-Executive Independent Directors for the year 2012-13 which shall be paid subject to and within the limit approved by the members of the Company at the previous Annual General Meeting held on 9th August, 2012 Name of Director Mr. K.G. Ramanathan Mr. Paresh Saraiya Mr. Milin Mehta Mr. Pranav Parikh Total
Amt in H Commission 2,50,000 2,50,000 2,50,000 1,00,000 8,50,000
6. General Body Meetings

Details of the location of the last three AGMs and the Extraordinary General Meetings held during the year : The Company was incorporated on 16th June, 2010 and only two AGMs are held since its incorporation. No Extra Ordinary General Meeting was held during the Financial Year 2012-13.

Year 2010-11 2011-12 Location Sanskruti, Alembic Corporate Conference Centre, Opp. Pragati Sahakari Bank Ltd., Alembic Colony, Vadodara 390 003. Sanskruti, Alembic Corporate Conference Centre, Opp. Pragati Sahakari Bank Ltd., Alembic Colony, Vadodara 390 003. * Whether special resolution was put through postal ballot last year? No. *Are polls proposed to be conducted through postal ballot this year? No. 6A. Notes on Directors seeking appointment / re-appointment as required under Clause 49 IV(G) of the Listing Agreement entered into with Stock Exchanges. Mr. Shaunak Amin seeks appointment at the ensuing Annual General Meeting. Mr. Paresh Saraiya and Mr. Milin Mehta seek re-appointment at the ensuing Annual General Meeting of the Company. Mr. Shaunak Amin has graduated from University of Massachusetts, USA with Economics as his specials. He has varied work experience with renowned Multinationals including Merril Lynch, Hong Kong and Shanghai Banking Corporation etc. His extensive experience in Sales and Marketing has beneted the Company immensely in achieving the new heights in sales. Mr. Shaunak Amin is President Formulations of the Company and is heading the Branded Formulations Division of the Company since 2009. He holds directorships AGI Developers Limited, Gujarat Flying Club (Section 25 Company) and Incozen Therapeutics Pvt. Ltd. He holds 10,06,980 Equity Shares of the Company. He is the son of Mr. Chirayu R. Amin and brother of Mr. Pranav Amin. Mr. Paresh Saraiya, is a Graduate in Mechanical Engineering with Distinction from the M.S. University of Vadodara. He is the Managing Director of Transpek-Silox Industry Limited, a joint venture company between Silox S.A., Belgium and the Excel/Transpek Group. He has a vast experience in technical, management and corporate functions. He also holds Directorships in Dinesh Remedies Limited, Excel Generics Limited, Shroffs Engineering Limited, TechnoKraft Products Private Limited and Transpek-silox Industry Limited. He is chairman of the Audit Committee and Shareholders/ Investors Grievances Committee of the Company also chairman of Audit Committee of Dinesh Remedies Limited and member of the Audit Committee of Transpek-Silox Industry Limited. He does not hold any equity shares of the Company.
Date 29th August, 2011 9th August, 2012
Time 3.30 p.m. 4.00 p.m.
No. of Special Resolutions passed 4 4
Mr. Milin Mehta is a Senior Partner of M/s. K. C. Mehta & Co., a reputed rm of Chartered Accountants. He is fellow member of the Institute of Chartered Accountants of India. He is also a Law Graduate and holds Masters Degree in Commerce. He has also co-authored a book on Minimum Alternate Tax published by The Bombay Chartered Accountants Society. He is also active in social service and is presently heading a reputed educational institution involved in providing school education in Vadodara. He also holds Directorships in Alembic Limited, Gujarat Life Sciences Pvt. Ltd, Startronic Investment Consultant Pvt. Ltd. and Technokraft Products Pvt. Ltd. He is Chairman of Audit Committee and Shareholders/Investors Grievances Committee of Alembic Limited and member of Audit Committee of the Company. He does not hold any equity shares of the Company. Shareholding of Non-Executive Directors: None of the Non-executive Directors hold any shares in the Company.
7. Disclosure
Related Party Transactions There were no materially signicant related party transactions that may have potential conict with the interest of the Company at large. Register of Contracts for the transactions in which Directors are interested is placed before the Board regularly for its approval. Transactions with related parties as per Accounting Standard No. AS18 are disclosed in Note No. Y of the Notes forming part of Accounts.
8. Compliance
The Company has complied with all the mandatory requirements of the Listing Agreements with Stock Exchanges as well as regulations and guidelines of SEBI. Further, there was no penalty/ stricture by any statutory authority during the year.

9. Means of Communication
Half-yearly results sent to each household of the shareholders Quarterly Results Which Newspapers normally published in Any web-site where displayed Whether Shareholder information forms part of Annual Report : : : : : The results are published in newspapers having wide coverage and also put on website of the Company. The results are published in newspapers having wide coverage Published normally inThe Economic Times (English), The Economic Times(Gujarati) www.alembic-india.com Yes
10. Shareholders Information

1 Annual General Meeting Date and Time Venue 2 Financial Calendar Quarter ending June 30, 2013 Quarter ending Sept.30, 2013 Quarter ending Dec. 31, 2013 Year ending 31st March, 2014 Annual General Meeting for the year ending 31st March, 2014 3 4 5 Date of Book Closure Dividend Payment Date Registered Ofce 31st July, 2013 (Wednesday) to 7th August, 2013 (Wednesday), both days inclusive On or after Monday, 12th August, 2013 Alembic Road, Vadodara -390 003. Phone: (91-265) 2280550, Fax: (91-265) 2282506 E-mail: apl.investors@alembic.co.in Web: www.alembic-india.com 6 Listing Details Bombay Stock Exchange Ltd. (BSE) Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai -400 001. (Security Code: 533573) National Stock Exchange of India Limited (NSE) Exchange Plaza, Bandra-Kurla Complex, Bandra (East), Mumbai -400 051. (Security Code: APLLTD) 7th August, 2013 at 4.00 p.m. Sanskruti, Alembic Corporate Conference Centre, Opp. Pragati Sahakari Bank Ltd., Alembic Colony, Vadodara 390 003. Adoption of Results for the quarter: by 14th August, 2013 by 14th November, 2013 by 14th February, 2014 By 30th May, 2014 Between July to September, 2014

7. Stock Market Data Month Apr-2012 May-2012 Jun-2012 Jul-2012 Aug-2012 Sep-2012 Oct-2012 Nov-2012 Dec-2012 Jan-2013 Feb-2013 Mar-2013 Bombay Stock Exchange Months High Price Months Low Price 59.95 48.10 56.65 47.70 57.60 47.50 62.50 54.60 74.25 58.10 78.95 68.00 73.80 65.55 70.70 61.75 74.00 63.60 80.00 68.10 84.80 72.40 112.90 80.00 (in H) National Stock Exchange Months High Price Months Low Price 59.90 47.80 56.40 48.00 57.50 45.00 62.50 54.50 74.50 58.30 78.95 67.00 73.75 66.00 70.50 61.50 73.85 56.00 80.00 68.25 84.75 72.25 112.95 80.00
As on 28th March, 2013, the last trading day of the nancial year 2012-13, the closing price of the shares of the Company on BSE was H104.15 and on NSE was H105.
Share Performance of the Company in comparison to BSE Sensex 20,000 120
110
19,000
100
Closing Sensex
90
18,000
80
70
17,000
60
50
16,000
Apr-12
May-12
Jun-12
Jul-12
Aug-12
Sep-12
Oct-12
Nov-12
Dec-12
Jan-13
Feb-13
Mar-13
40
Closing Sensex
Closing Share Price
Closing Share Price

8 Registrar and Share transfer Agents Link Intime India Pvt. Limited B-102 & 103, Shangrila Complex, First Floor, Opp. HDFC Bank, Near Radhakrishna Char Rasta, Akota, Vadodara-390020 Tel:(0265) 2356573, 2356794 Fax:(0265) 2356791 Email: vadodara@linkintime.co.in 9 Share Transfer System Share transfers are registered and returned within a period of Fifteen days from the date of receipt, if documents are accurate in all respects. The Shareholders/Investors Committee meet every month and transfers are also approved by Company Secretary/ Authorised representative of Registrar and Share Transfer Agent, generally at the interval of Seven days time. Total number of shares transferred in physical form during the year were 79,905 (previous year 80,390). Distribution of Shareholding The Distribution of Shareholdings as on 31st March, is given as under: Number of Share of Face Value 1 1-500 501-1000 1001-2000 2001-3000 3001-4000 4001-5000 5001-10000 10001 and above Total No. of Shareholders 2 38020 4156 2115 696 316 255 412 380 46350 % of total Shareholders 3 82.03 8.97 4.56 1.50 0.68 0.55 0.89 0.82 100.00 No. of Shares 4 62,36,308 32,89,943 31,78,920 18,03,495 11,26,430 11,86,579 29,16,526 16,87,77,713 18,85,15,914 % of total Shares 5 3.31 1.74 1.69 0.96 0.60 0.63 1.54 89.53 100.00
Shareholding pattern as on 31st March, 2013 Sr. No. 1 2 3 4 5 6 7 8 Category Promoters & Associates Mutual Funds & UTI Banks, Financial Institutions & Insurance Companies Foreign Institutional Investors Private Corporate Bodies Indian Public NRIs / OCBs Others (Clearing Members, Trusts etc.) Total Dematerialisation of Shares and Liquidity No. of Shares Held 13,97,38,620 15,85,227 9,06,575 1,41,68,733 23,78,133 2,88,48,620 6,27,219 2,62,787 % of Voting Strength 74.13 0.84 0.48 7.51 1.25 15.3 0.33 0.16
10
18,85,15,914 100.00 As on 31st March, 2013 18,32,71,154 shares (97.22%) were held in dematerialised form by the shareholders.

11 12 Outstanding GDR/Warrants Plant Location Not applicable a. Panelav, Tal. Halol, Dist. Panchmahal -389 350, Gujarat. b. c. 1. Plot No. 21, 22, EPIP Phase I, Jharmajri, Baddi, Tehsil -Nalagarh, Dist. Solan, Himachal Pradesh. 13 Investor Correspondence Village Karakhadi, Tal. Padra, Dist. Vadodara. Link Intime India Private Ltd B-102/103, Shangrila Complex, 1st Floor, Opp. HDFC Bank, Radha Krishna Char Rasta, Akota Vadodara-390020 2. Mr. R.K.Baheti Director - Finance & Company Secretary - Compliance Ofcer Alembic Pharmaceuticals Limited Alembic Road, Vadodara-390003
Auditors Certicate on Corporate Governance

The Members of Alembic Pharmaceuticals Limited, Vadodara 390 003.
We have examined the compliance of conditions of Corporate Governance by Alembic Pharmaceuticals Limited, for the year ended 31st March, 2013 as stipulated in clause 49 of the Listing Agreement as prescribed by the stock exchange(s). The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited to the procedures and implementation thereof, adopted by the Company for ensuring compliance with the conditions of Corporate Governance. It is neither an audit nor an expression of opinion on the nancial statements of the Company. In our opinion and to the best of our information and according to the explanations given to us and the representations made by the Directors and the Management, we certify that the Company has complied in with the conditions of Corporate Governance as stipulated in the prescribed Listing Agreement. We further state that such compliance is neither an assurance as to the future viability of the Company nor the efciency or effectiveness with which the management has conducted the affairs of the Company.
For K.S. AIYAR & Co. Chartered Accountants; FRN: 100186W RAGHUVIR M. AIYAR Partner Membership No. - 38128 Mumbai, Date: 2nd May, 2013
Independent Auditors Report

To the Members of Alembic Pharmaceuticals Limited Report on the Financial Statements
We have audited the accompanying nancial statements of Alembic Pharmaceuticals Limited (the Company), which comprise the Balance Sheet as at March 31, 2013, and the Statement of Prot and Loss and Cash Flow Statement for the year then ended, and a summary of signicant accounting policies and other explanatory information. Managements Responsibility for the Financial Statements Management is responsible for the preparation of these nancial statements that give a true and fair view of the nancial position, nancial performance and cash ows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 (the Act). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the nancial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error. Auditors Responsibility Our responsibility is to express an opinion on these nancial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the nancial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the nancial statements. The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the nancial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Companys preparation and fair presentation of the nancial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the nancial statements. We believe that the audit evidence we have obtained is sufcient and appropriate to provide a basis for our audit opinion. Opinion In our opinion and to the best of our information and according to the explanations given to us, the nancial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India: (a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2013; (b) in the case of the Statement of Prot and Loss, of the prot for the year ended on that date; and (c) in the case of the Cash Flow Statement, of the cash ows for the year ended on that date. Report on Other Legal and Regulatory Requirements 1. As required by the Companies (Auditors Report) Order, 2003 (the Order) issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specied in paragraphs 4 and 5 of the Order. 2. As required by section 227(3) of the Act, we report that: a. we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit; b. in our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books; c. the Balance Sheet, Statement of Prot and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account; d. in our opinion, the Balance Sheet, Statement of Prot and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956; e. on the basis of written representations received from the directors as on March 31, 2013, and taken on record by the Board of Directors, none of the directors is disqualied as on March 31, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956. For K.S. Aiyar & Co; Chartered Accountants FRN: 100186W Raghuvir M. Aiyar Mumbai Date: 2nd May, 2013 Partner M. No. 38128
Annexure to the Auditors Report

Re: Alembic Pharmaceuticals Limited
Referred to in paragraph 1 on Report on Other Legal and Regulatory Requirements of our report. (i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of Fixed Assets. However, item wise value in respect of assets other than land, buildings and vehicles prior to 1982 are not available. (b) Fixed assets have been physically veried by the management during the year as per the phased programme of physical verication of xed assets. As informed to us the programme is such that all the xed assets will get physically veried in three years time. In our opinion the same is reasonable having regard to the size of the Company and the nature of its xed assets. No material discrepancies were noticed on such verication. (c) During the year, the Company has not disposed off any substantial part of its xed assets. (ii) (a) The inventory has been physically veried during the year by the management at reasonable intervals. (b) The procedures for physical verication of inventory followed by the management are reasonable and adequate in relation to size of the Company and nature of its business. (c) The Company is maintaining proper records of inventory. The discrepancies noticed on verication between the physical stocks and the book records were not material. (iii) (a) The Company has granted unsecured loan to one company covered in the register maintained under section 301 of the Companies Act, 1956 wherein the balance recoverable as at the year end is H Nil (Maximum balance during the year H 7,950 Lacs). (b) In our opinion, the rate of interest and other terms and conditions of loans given by the Company, secured or unsecured, to parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima-facie, prejudicial to the interest of the Company. (c) In respect of the above loans granted, receipt/renewal of the principal amount and interest were regular, as stipulated. (d) There is no overdue amount of more than rupees one lakh of loans granted to companies, rms or other parties listed in the register maintained under section 301 of the Companies Act, 1956. (e) The Company has not taken any unsecured loan from any party covered in the register maintained under section 301 of the Companies Act, 1956.Therefore, the requirement of clause (f) and (g) are not applicable. (iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchases of inventory and xed assets and for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in the internal control system. (v) (a) The particulars of contracts or arrangements referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that section. (b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements exceeding `5,00,000 have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time. (vi) In our opinion and according to the information and explanations given to us, the Company has complied with provisions of Section 58A and 58AA or any other relevant provision of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. No order has been passed by the Company Law Board, National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal. (vii) In our opinion, the Company has an internal audit system commensurate with its size and nature of its business. (viii) We have broadly reviewed the books of account relating to materials, labour and other items of cost maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under Section 209 (1)(d) of the Companies Act, 1956 and we are of the

opinion that, prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records for determining whether they are accurate or complete. (ix) (a) The Company is generally regular in depositing with appropriate authorities, undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other material statutory dues applicable to it and there are no arrears outstanding as at the year end for a period of more than six months from the date they became payable. (b) According to the records of the Company, the following dues of Sales Tax, Income Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess have not been deposited on account of some dispute or are partially deposited under protest.
Statute & Nature of dues Sales Tax Act Sales Tax, interest and penalty
Amount not deposited in D 4,82,244
Forum where dispute is pending Joint Commissioner Appeals
Period 2008-09
Central Sales Tax Act
The Central Excise Act Excise Duty, Interest & Penalty
The Bombay Stamp Act
13,12,295 1,63,84,603 44,830 1,53,406 17,49,933 1,84,321 24,654 34,11,482 5,389,411 64,32,292 5,20,052 1,51,971 75,612 2,46,931 1,50,355 10,93,955 26,302 28,481 2,13,95,574 56,07,997 16,091 23,53,824 2,10,579 35,000 50,03,165 1,20,99,486 55,306 121,276 10,181,463 5,01,18,535
High Court Asst.Commissioner Demand Additional Commissioner Sr.Joint Commissioner Joint Commissioner Appeals Additional Commissioner Additional Commissioner Additional Commissioner Additional Commissioner Additional Commissioner Commissioner Additional Commissioner Additional Commissioner Deputy Commissioner II Joint Commissioner (Appeals) Deputy Commissioner II Additional Commissioner Additional Commissioner CESTAT CESTAT Commissioner (Appeal) CESTAT CESTAT Commissioner (Appeal) High Court High Court Commissioner (Appeals) Commissioner (Appeals) CESTAT The Honble Chief Controlling Revenue Authority, Gandhinagar
1999-2000 2003-04 2004-05 2006-07 2009-10 01-04-2006 to 30-11-2008 01-12-2008 to 31-10-2009 2007-08 2008-09 2009-10 2005-06 01-04-2006 to 30-11-2008 01-12-2008 to 31-10-2009 2003-04 2005-06 2006-07 2008-09 2009-10 2005-06 2007-08 2007-08 2001-02 1998-99 2009-10 2005-06 2005-06 2008-09 2010-11 2006-11 2011-12

(x) As the Company is registered for a period less than 5 years, the requirement of the Order of reporting on accumulated losses and cash losses is not applicable. (xi) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to a nancial institution, bank or debenture holders. (xii) According to the information and explanations given to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities. (xiii) The Company is not a Chit Fund or a Nidhi/Mutual Benet Fund/Society. Therefore, the provisions of Clauses 4(xiii) of the Companies (Auditors Report) Order, 2003 (as amended) are not applicable to the Company. (xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditors Report) Order, 2003 (as amended) are not applicable to the Company. (xv) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from bank or nancial institutions. (xvi) According to the information and explanations given to us, the term loans have been applied for the purpose for which the loans were obtained. Mumbai Date: 2nd May, 2013 For K.S. Aiyar & Co; Chartered Accountants FRN: 100186W Raghuvir M. Aiyar Partner Membership No.38128 (xvii) According to the information and explanations given to us, and on an overall examination of Balance Sheet of the Company, we report that no funds raised on short-term basis have been used for long term investment. (xviii) The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956. (xix) The Company does not have any Debentures outstanding as at the year end. (xx) The Company has not raised any money during the year by public issue. (xxi) As per the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.
Balance Sheet
Particulars I. EQUITY AND LIABILITIES (1) Shareholders Funds (a) Share Capital (b) Reserves and Surplus (2) Non-Current Liabilities (a) Long-Term Borrowings (b) Deferred Tax Liabilities (Net) (c) Other Long Term Liabilities (d) Long Term Provisions (3) Current Liabilities (a) Short-Term Borrowings (b) Trade Payables (c) Other Current Liabilities (d) Short-Term Provisions Total II. ASSETS (1) Non-current assets (a) Fixed Assets (i) Tangible Assets (ii) Capital Work-in-Progress (b) Non-Current Investments (c) Long Term Loans And Advances (2) Current assets (a) Inventories (b) Trade Receivables (c) Cash and Bank Balances (d) Short-Term Loans And Advances Total Signicant Accounting Policies and other explanatory notes and information Y Note No As at 31st March, 2013 H in lacs As at 31st March, 2012 A B 3,770.32 42,206.06 45,976.38 C D E F G H I J 7,053.47 1,389.69 1,276.07 606.06 7,011.45 23,424.56 6,925.29 6,205.50 9,485.67 952.90 1,229.07 539.04 13,843.49 18,192.75 15,160.44 3,566.34 3,770.32 32,315.92 36,086.24
10,325.29
12,206.69
43,566.80 99,868.47
50,763.02 99,055.94
K L M N O P Q
34,422.15 3,226.18 335.42 3,587.88 26,683.33 23,238.30 424.97 7,950.24
41,571.63
26,781.86 5,823.97 335.42 3,499.13 25,874.15 18,683.28 2,573.39 15,484.75
36,440.38
58,296.84 99,868.47
62,615.57 99,055.94
Note : The notes referred to above form an integral part of the Balance Sheet
As per our report of even date For K. S. AIYAR & CO. Chartered Accountants Firm Registration No. 100186W RAGHUVIR M. AIYAR Partner Membership No 38128 Mumbai : 2nd May, 2013 CHIRAYU R. AMIN Chairman & Managing Director PARESH SARAIYA Director PRANAV AMIN Director & President International Business MILIN MEHTA Director R.K. BAHETI Director, President Finance & Company Secretary Vadodara : 2nd May, 2013 K.G. RAMANATHAN Director
Statement of Profit and Loss

Particulars I. Revenue From Operations Less : Excise Duty II. Other Income III Total Revenue (I +II) IV. Expenses: Cost of Materials Consumed Purchase of Finished Goods Changes in Inventories of Finished Goods and Work in Process Employee Benet Expenses Research and Development Expenses Other Expenses Total Expenses V. Prot Before Interest, Depreciation and Tax Finance Costs Depreciation VI. Prot Before Tax VII. Tax Expense Current Tax Deferred Tax VIII. Prot for the Year IX. Earning Per Equity Share (FV D 2/- Per Share) Basic & Diluted (In H) Signicant Accounting Policies and Other Explanatory Notes and Information Note No R S For the Year ended on 31st March, 2013 1,50,138.83 875.00 1,49,263.83 393.20 1,49,657.03 47,029.77 16,559.05 2,134.01 19,378.97 7,363.28 32,422.27 1,24,887.35 24,769.68 1,457.43 3,496.46 19,815.79 3,975.00 96.43 15,744.36 8.35 Y H in lacs For the Year ended on 31st March, 2012 1,37,984.43 554.00 1,37,430.43 142.07 1,37,572.50 52,823.76 16,779.29 (6,443.98) 16,845.82 5,858.22 30,708.35 1,16,571.45 21,001.05 2,621.34 3,364.58 15,015.13 3,000.00 (38.38) 12,053.51 6.39
T T U V W
Note : The notes referred to above form an integral part of the Statement of Prot and Loss
Cash Flow Statement

H in lacs Particulars A CASH FLOW FROM OPERATING ACTIVITIES: Net Prot Before Tax Add: Depreciation Interest Charged Unrealised Foreign Exchange Loss / (Gain) General Reserve Utilised for Expenses as Per the Scheme of Arrangement (Gain)/Loss on Sale of Fixed Assets Less: Interest Income Dividend Income Expenses on Account of Scheme of Arrangement debited to Reserves Operating Prot before Change in Working Capital Working Capital Changes: Add / (Less): (Increase) / Decrease in Inventories (Increase) / Decrease in Trade Receivables (Increase) / Decrease in Short-Term Loans and Advances (Increase) / Decrease in Long-Term Loans and Advances Increase / (Decrease) in Trade Payables Increase / (Decrease) in Other Current Liabilities Increase / (Decrease) in Short Term Provisions Increase / (Decrease) in Long Term Provisions Cash Generated from Operations Add / (Less): Direct Taxes Paid (Net of Refunds) Net Cash Inow from Operating Activities (A) CASH FLOW FROM INVESTING ACTIVITIES: Add: Proceeds from Sale of Fixed Assets Increase in Restrictive Bank Balances Interest Received Dividend Received Less: Purchase of Tangible Assets / Increase in Capital Work-in-Progress Net Cash Inow from Investing Activities (B) Year ended on 31st March, 2013 19,815.79 3,496.46 2,398.20 793.32 3.39 940.77 22.70 6,691.37 3,364.58 3,754.84 770.44 67.06 (0.53) 1,133.50 0.35 67.06 7,956.39 Year ended on 31st March, 2012 15,015.13
1 2 3 4 5 1 2 3
963.47 25,543.69
1,200.92 21,770.61
1 2 3 4 5 6 7 8
(809.18) (4,814.46) 6,596.68 (88.75) 5,114.07 (456.25) 108.32 67.02
5,717.45 31,261.14 (3,829.56) 27,431.58
(3,950.96) 1,788.80 (6,248.43) (2,844.66) 4,980.57 (18.54) 182.97 28.88
(6,081.36) 15,689.25 (3,147.44) 12,541.81
B 1 2 3 4
54.97 1,817.51 22.70 1,895.18
4.55 26.49 455.27 0.35 486.67 6,125.63 8,597.33 (6,702.15) 6,125.63 (5,638.96)
8,597.33
Cash Flow Statement (Contd.)

H in lacs Particulars C 1 2 1 2 3 4 CASH FLOW FROM FINANCIAL ACTIVITIES: Add: Proceeds from Long-Term Borrowings Increase in Other Long Term Liabilities Less: Repayment of Long-Term Borrowings Repayment of Short-Term Borrowings Dividends Paid (including Distribution Tax) Interest and Other Finance Costs Net Cash Inow from Financing Activities (C) Net (Decrease)/Increase in Cash and Cash Equivalents Add: Cash and Cash Equivalents at the Beginning of the Period Add: Other Bank Balances Cash and Cash Equivalents at the End of the Period Other Bank Balances Year ended on 31st March, 2013 Year ended on 31st March, 2012
47.00 10,177.02 6,832.04 3,036.23 2,879.56
47.00
6,628.21 44.90 4,462.07 784.19 2,164.49 3,720.61
6,673.11
22,924.85 (22,877.85) (2,148.42)
11,131.37 (4,458.26) 2,444.59
II. III. IV.
2,546.90 26.49 367.34 57.63
2,573.39 424.97
128.80 2,546.90 26.49
128.80 2,573.39
Notes to Balance Sheet

A Share Capital :
H in lacs As at 31st March (a) Authorised 20,00,00,000 2013 Equity shares of H 2/- each 4,000.00 4,000.00 3,770.32 2012 4,000.00 4,000.00 3,770.32
(b) Shares issued, subscribed and fully paid : 18,85,15,914 Equity shares of H 2/- each Out of above 13,35,15,914 equity shares of H 2/- each were issued to the share holders of Alembic Limited as per the Scheme of Arrangement and without payment being received in cash
3,770.32 (c) Reconciliation of the number of shares outstanding at the beginning and at the end of the reporting period ;
3,770.32
31st March 2013 31st March 2012 Numbers Amount in lacs Numbers Amount in lacs 18,85,15,914 3,770.32 At the beginning of the period 5,50,00,000 1,100.00 Issued during the period 13,35,15,914 2,670.32 18,85,15,914 3,770.32 Outstanding at the end of the period 18,85,15,914 3,770.32 (d) The rights, preferences and restrictions including restrictions on the distribution of dividends and the repayment of capital; The company is having only one class of shares i.e Equity carrying a nominal value of H 2/- per share Every holder of the equity share of the Company is entitled to one vote per share held In the event of liquidation of the Company, the equity shareholders will be entitled to receive remaining assets of the Company after the distribution / repayment of all creditors. The distribution to the equity shareholders will be in proportion of the number of shares held by each shareholder The Company declares and pays dividend on the equity shares in Indian Rupees. Dividend proposed by the Board of Directors is subject to approval of the shareholders at the ensuing Annual General Meeting. During the year ended 31st March, 2013 an amount of H 2.50 of dividend per equity share was proposed for the equity shareholders ( PY H 1.40 per equity share) (e) Shares in the company held by each shareholder holding more than 5 percent shares specifying the number of shares held; 31st March 2013 Numbers 5,50,00,000 1,83,68,780 1,71,67,670 1,82,85,230 1,62,13,755 31st March 2012 Numbers 5,50,00,000 1,83,68,780 1,71,67,670 1,82,85,230 1,62,13,755
1 2 3 4 5
Alembic Limited Shreno Limited Sierra Investments Limited Whiteeld Chemtech Limited Nirayu Private Limited
% held 29.18% 9.74% 9.11% 9.70% 8.60%
% held 29.18% 9.74% 9.11% 9.70% 8.60%

B Reserves and Surplus :
H in lacs As at 31st March (a) Capital Reserve ; Balance as per the last nancial statements (b) Debenture Redemption Reserve; Balance as per the last nancial statements Less : Transferred to General Reserve Add : Transferred from Statement of Prot and Loss (c) General Reserve Balance as per the last nancial statements Less : Utilised against provision for expenses on account of Scheme of Arrangement Less : Reversal of Deferred Tax Asset on account of Intangible assets pursuant to the order of Hon'ble Gujarat High Court Add : Transfer from Debenture redemption reserve Add : Amount transferred from Surplus Balance in the Statement of Prot & Loss (d) Surplus / (decit) in the statement of prot and loss Balance as per last nancial statements Prot for the year Appropriations Less: Transfer to Debenture redemption reserve Proposed nal equity dividend amount per share H 2.50 (PY : H 1.40) Tax on proposed equity dividend Transfer to General Reserve Total Appropriations Net Surplus in the statement of prot and loss Total Reserves and Surplus 2013 30.00 3,125.00 3,125.00 23,798.35 340.36 3,125.00 8,000.00 2,333.40 791.60 19,319.21 67.04 453.82 3,125.00 2012 30.00
34,582.99
5,000.00
23,798.35
5,362.57 15,744.36 4,712.90 800.96 8,000.00 13,513.86 7,593.07 42,206.06
2,168.03 12,053.51 791.60 2,639.22 428.15 5,000.00 8,858.97 5,362.57 32,315.92
C Long-Term Borrowings :
As at 31st March (a) Non Convertible Debentures (Secured) H NIL (PY H 5000 lacs) 9.25% Coupon of H1 lac each Secured against rst hypothecation charge on all movable plant and machinery ranking pari passu with other lenders Redeemable equally in July-12 and Sept-12 and redeemed H NIL (PY H 2500 lacs) 10.80% Coupon of H1 lac each Secured against rst hypothecation charge on all movable plant and machinery ranking pari passu with other lenders Redeemable in June-12 and redeemed
Non-Current 2013 2012 -
Current Maturities 2013 2012 5,000.00
2,500.00

C Long-Term Borrowings (Contd.) :
As at 31st March (b) Term loans (Secured) Foreign Currency loan from Banks - @ Coupon of LIBOR plus 1.50% p.a. plus proportionate front end fees Secured against rst hypothecation charge on all movable plant and machinery ranking pari passu with other lenders Redeemable in 15 equal quarterly installments of USD 1 MN starting from May-13 Foreign Currency loan from Banks - @ varying rate of interest Secured against rst hypothecation charge on all movable plant and machinery ranking pari passu with other lenders Redeemable in Apr-12 USD 1.67 MN and balance in June-12 and redeemed (c) Deposits (Unsecured) Deposits from Shareholders Deposits from Public - @ interest rate varying from 9% to 11% and maturity period is 12 / 24 / 36 months (d) Others (Unsecured) Repayable in 10 equal yearly installments of H 2.85 lacs each commencing from Oct-2004. Interest rate 3% The above amount includes amount disclosed under the head Other Current Liabilities (Note I) 7,053.47 7,053.47 9,485.67 9,485.67 4,614.24 (4,614.24) 11,942.92 (11,942.92) Non-Current 2013 2012 5,970.80 7,632.00 H in lacs Current Maturities 2013 2012 2,171.20 -
1,624.27
419.30 663.37
159.30 1,691.52
210.20 2,229.99
174.50 2,641.30
2.85
2.85
2.85
D Deferred Tax Liabilities (Net) :

As at 31st March Deferred Tax Assets Provision for Doubtful debts Preliminary Expense and Demerger Expense Intangible Asset Others Deferred Tax Liabilities Depreciation 2013 175.83 32.76 1,021.09 426.21 1,655.89 3,045.58 1,389.69 2012 172.59 46.97 1,361.45 367.59 1,948.60 2,901.50 952.90

E Other Long Term Liabilities :
H in lacs As at 31st March Trade Deposits 2013 1,276.07 1,276.07 2012 1,229.07 1,229.07
F Long Term Provisions :

As at 31st March 2013 (a) Provision for employee benets Provision for gratuity Provision for Leave benets (b) Others Proposed equity dividend Provision of tax on Proposed equity dividend Amount disclosed under the head Short term provisions (Note J) 606.06 539.04 Long Term 2012 539.04 539.04 Short Term 2013 2012 304.48 302.81 607.29 4,712.90 800.96 5,513.86 (6,121.15) 250.68 248.29 498.97 2,639.22 428.15 3,067.37 (3,566.34) -
606.06 606.06 -
G Short-Term Borrowings :
As at 31st March (a) From Banks i) Working Capital facilities (Secured) Secured against rst hypothecation on Stocks and Book Debts ranking pari passu - @ varying Coupon repayable on demand ii) Others (Unsecured) - @ varying Coupon repayable within 180 days with an option of roll over (b) Commercial Paper (Unsecured) - @ Coupon of 10.20% repayable within 90 days 2013 1,040.65 2012 2,357.44
5,970.80
8,986.05
7,011.45
2,500.00 13,843.49
H Trade Payable :
As at 31st March Due to Micro and Small Enterprises Other Trade Payables 2013 55.65 23,368.91 23,424.56 2012 54.31 18,138.44 18,192.75

I Other Current Liabilities :
H in lacs As at 31st March (a) Current maturities of long-term debt (Note C) (b) Interest accrued but not due on borrowings (c) Unpaid dividends (d) Unpaid / Unclaimed matured deposits and interest accrued thereon Unclaimed matured Deposits Interest accrued thereon (e) Other payables / liabilities Statutory dues Others 2013 4,614.24 193.69 57.63 48.03 2.13 748.42 1,261.15 6,925.29 2012 11,942.92 675.52 26.49 36.05 1.66 765.31 1,712.49 15,160.44
J Short-Term Provisions :
As at 31st March (a) Provision for employee benets. (Note F) (b) Others . Proposed equity dividend and Tax thereon (Note F) Provision for Income Tax Less : Income Tax paid 2013 607.29 5,513.86 8,778.50 (8,694.15) 84.35 6,205.50 3,566.34 2012 498.97 3,067.37
K Tangible Assets :
DESCRIPTION As on 01/04/2012 Free Hold Land Lease Hold Land Buildings Employees Quarters Plant & Equipments R&D Equipments Furniture & Fixtures Vehicles Ofce Equipments TOTAL Previous Year 192.44 1,634.78 9,730.56 28.30 24,076.74 7,240.58 596.89 2,384.98 404.12 46,289.39 43,352.09 GROSS BLOCK Addition 4,915.53 5,697.25 264.38 95.10 105.18 117.68 11,195.12 2,951.92 238.38 14.62 Deductions 200.64 37.74 As on 31/03/2013 192.44 1,634.78 14,646.09 28.30 29,573.35 7,504.96 691.99 2,452.42 521.80 57,246.13 46,289.39 As on 01/04/2012 63.26 1,786.40 6.59 12,606.52 4,136.83 257.76 524.21 125.96 19,507.53 16,153.55 180.02 10.60 DEPRECIATION Deductions 150.67 29.35 During the Year 17.21 348.62 2,291.98 569.67 36.72 156.87 75.40 3,496.47 3,364.58 As on 31/03/2013 80.47 2,135.02 6.59 14,747.83 4,706.50 294.48 651.73 201.36 22,823.98 19,507.53 NET BLOCK As on 31/03/2013 192.44 1,554.31 12,511.07 21.71 14,825.52 2,798.46 397.51 1,800.69 320.44 34,422.15 26,781.86 As on 31/03/2012 192.44 1,571.52 7,944.16 21.71 11,470.22 3,103.75 339.13 1,860.77 278.16 26,781.86
Notes: 1. Sales proceeds are deducted from gross cost where cost is unascertainable 2. No Depreciation has been claimed on assets to the extent of Cenvat claimed

L Non-Current Investments :
H in lacs As at 31st March Trade Investments : Unquoted equity instruments Investment in wholly owned subsidiary 1,00,000 (PY: 1,00,000) equity shares of CHF 1 each fully paid up in Alembic Global Holding SA Others 10,00,000 (PY: 10,00,000) equity shares of H 10 each at a premium of H20 each fully paid up in Incozen Therapeutics Pvt. Ltd. towards seed funding for Contract Research Non - Trade Investments : Unquoted equity instruments 18,000 (PY: 18,000) equity shares of H 1 each fully paid up in Shivalik Solid Waste Management Ltd. 2013 2012
33.62
33.62
300.00
300.00
1.80 335.42
1.80 335.42
M Long-Term Loans And Advances (Unsecured, considered good) :

As at 31st March (a) Capital Advances (b) Security Deposits 2013 625.42 2,962.46 3,587.88 2012 395.26 3,103.87 3,499.13
N Inventories (Refer Note Y (e) of Accounting Policies for Basis of Valuation) :

As at 31st March (a) Raw materials - API, Chemicals and Intermediates - Excipients - Solvents & Catalyst (b) Packing materials (c) Work-in-process (d) Finished goods - API, Chemicals and Intermediates - Formulations - Tablets and Capsules - Formulations - Injectables - Formulations - Oral Preparation and Ointments - Others (e) Traded goods - Formulations - Tablets and Capsules - Formulations - Injectables - Formulations - Oral Preparation and Ointments (f) Stores and spares 2013 5,127.14 3,032.87 609.06 2012 2,474.10 2,993.40 492.79
8,769.07 1,669.10 1,448.48
5,960.29 1,509.03 994.08
7,422.15 1,043.35 425.42 587.05 2,799.11 1,153.71 362.56 748.72
12,277.08
9,992.97 1,587.71 591.32 807.64 1,352.43 1,567.40 360.95 870.06
14,332.07
2,264.99 254.61 26,683.33
2,798.41 280.26 25,874.15

O Trade Receivables (Unsecured) :
H in lacs As at 31st March (a) Over Six months from the due date Considered good Considered doubtful Less : Provision for doubtful debts (b) Others Considered good; 2013 901.66 541.94 541.94 2012 122.74 531.96 531.96
901.66 22,336.64 23,238.30
122.74 18,560.55 18,683.28
P Cash and Bank Balances :

As at 31st March (a) Cash and cash equivalents (i)Bank deposits with less than 3 months maturity from the origin date (ii)Balances with banks (iii)Cash on hand (b) Other Bank Balances Unpaid Dividend Account 2013 5.15 338.34 23.85 57.63 424.97 2012 2,304.60 213.25 29.05 26.49 2,573.39
Q Short-Term Loans and Advances (Unsecured, considered good) :

As at 31st March (a) Loans and advances to related parties; Inter Corporate Deposits (b) Others (i) Advance against Expenses - Employees (ii) Advance recoverable in cash or in kind (iii) Income Tax paid Less : Provision for Income Tax 2013 430.02 7,520.22 7,950.24 4,864.09 (4,803.00) 2012 6,300.00 290.05 8,833.60 61.09 15,484.75
Notes to Statement of Profit and Loss

R Revenue From Operations :
H in lacs For the year ended 31st March a) Sale of products - Domestic - Exports Export Incentives Royalty Other Operating Revenues - Others Sale of Products - Broad head wise Bulk Drugs, Chemicals and Intermediates Formulations - Tablets and Capsules Formulations - Injectables Formulations - Oral Preparation and Ointments 2013 1,00,877.42 46,641.53 1,47,518.95 789.27 1,521.68 308.93 1,50,138.83 32,286.04 77,090.99 11,055.23 27,086.69 1,47,518.95 28,235.57 72,288.02 11,393.63 23,302.35 1,35,219.57 2012 87,717.89 47,501.68 1,35,219.57 1,298.85 1,160.44 305.57 1,37,984.43
b)
S Other Income :
For the year ended 31st March Dividend Insurance Claims Rent 2013 22.70 370.50 393.20 393.20 2012 0.35 98.00 43.72 142.07 142.07

T Cost of Material Consumed :
H in lacs For the year ended 31st March Inventory at the beginning of the year Add : Purchases Less : Inventory at the end of the year Details of Material Consumed Bulk Drug and Drug intermediates Excipients Solvents & Catalyst Packing Material Others Changes in inventories of Finished Goods, Work in process : Inventory at the end of the year Work in Process Finished Goods Inventory at the beginning of the year Work in Process Finished Goods 2013 7,469.32 49,998.62 57,467.94 10,438.17 47,029.77 26,092.43 7,052.23 5,260.90 7,213.90 1,410.31 47,029.77 2012 9,768.62 50,524.46 60,293.08 7,469.32 52,823.76 24,366.90 9,202.41 5,802.39 7,561.89 5,890.17 52,823.76
1,448.48 14,542.07 15,990.55 994.08 17,130.48 18,124.56 2,134.01
994.08 17,130.48 18,124.56 934.20 10,746.38 11,680.58 (6,443.98)
U Employee Benets Expenses :

For the year ended 31st March Salaries and Wages Contribution / Provisions for Provident and other funds Staff welfare expense 2013 18,168.23 854.89 355.85 19,378.97 2012 15,617.14 903.64 325.04 16,845.82
V Research & Development Expenses :

For the year ended 31st March Material Consumption Employees' Cost Salaries and Wages Contribution / Provisions for Provident and other funds Utilities Power Others Bio-Study Expense & Filing Fees Others 2013 1,416.08 2,238.00 91.94 345.69 87.50 2,098.15 85.65 203.62 145.66 2012 874.95
2,329.94
2,183.80
433.19 781.78 2,402.29 7,363.28
349.28 969.88 1,480.31 5,858.22

W Other Expenses :
H in lacs For the year ended 31st March Consumption of Stores, Spares, Laboratory Material and Analytical Expense Power and Fuel Manufacturing and Labour Charges Repairs and Maintenance Machinery Buildings Others Freight and Forwarding Charges Marketing and Publicity Expense and Selling Commission Excise Duty Rent Rates and Taxes Insurance Travelling Expense Communication Expenses Legal & Professional Fees Payment to Auditor Exchange Difference (net) Bad Debts written off Less : Bad Debts Provision Utilised Provision for Doubtful Debts Miscellaneous Expenses 2013 1,738.52 2,665.51 1,794.05 509.88 241.73 266.37 518.95 190.07 286.87 2012 1,989.33 2,957.42 1,976.97
1,017.98 2,128.11 13,350.22 100.49 314.71 497.94 218.59 5,888.19 1,055.21 687.08 57.32 224.12 50.00 634.23 32,422.27
995.89 2,172.59 10,820.75 508.84 187.16 472.25 205.35 5,179.98 973.56 923.34 50.07 300.34 306.02 688.47 30,708.35
40.02 40.02
355.83 355.83
X Finance Costs :
For the year ended 31st March Interest Expense Less : Interest Income 2013 2,398.20 940.77 1,457.43 2012 3,754.84 1,133.50 2,621.34

Y I. Signicant Accounting Policies :
a) Basis of Accounting The Financial Statements are prepared as per historical cost convention and on accrual basis and are in conformity with mandatory Accounting Standards and relevant provisions of the Companies Act, 1956.
b) Fixed Assets Certain Fixed Assets have been recorded at a value transferred as per the Scheme of Arrangement. Other Fixed Assets are recorded at cost of acquisition / construction less accumulated depreciation and impairment losses, if any. Cost comprises of the purchase price net of Cenvat, Service Tax and Value Added Tax and any attributable cost of bringing the assets to its working condition for its intended use. Borrowing Cost directly attributable to acquisition / construction of xed asset which necessarily take a substantial period of time to get ready for their intended use are capitalised. c) Depreciation / Amortisation Depreciation on Fixed Assets is provided on Straight Line Method at the rates specied in Schedule XIV to the Companies Act,1956 Leasehold Land is amortised over the period of Lease. d) Investments Investments are classied into Current and Long Term Investments. Current Investments are valued at lower of cost and fair value. Long Term Investments are stated at cost less provision, if any, for decline other than temporary in their value. Investment in Subsidiary company are stated at a value transferred as per the Scheme of Arrangement Inventories All Inventories are valued at lower of cost and net realisable value. Raw Materials, Stores and Spares & Packing Material are valued at lower of cost determined on weighted average basis and net realisable value. Work in process is valued at lower of cost and net realisable value. Finished Goods is valued at lower of cost including excise payable thereon and net realisable value. Traded Goods is valued at lower of Purchase price and net realisable value. Slow moving Raw Materials, Stores & Spares are valued at estimated net realisable value. Revenue from Operations Sale of products are recognised when risk and rewards of ownership of the products are passed on to the customers, which is generally on the dispatch of goods. Sales are inclusive of excise duty, but net of sales return, Service Tax & Value Added Tax & CST. Export sales are recognised on the date of bill of lading / Airway bill. Income from operations includes revenue earned, as per the terms agreed with the customers, from development of products and assignment of patent rights. g) R & D Expenses All revenue expenses related to R & D including expenses in relation to development of product/ processes and expenses incurred in relation to compliances with international regulatory authorities in obtaining of Abbreviated New Drug Applications (ANDA) are charged to the Statement of Prot & Loss in the year in which it is incurred.
e)
f)

Y I. Signicant Accounting Policies : (Contd.)
h) Foreign Exchange Transactions Foreign Currency transactions are initially recorded at the rate of exchange prevailing on the date of transaction Monetary assets and liabilities related to foreign currency transactions remaining unsettled at the end of the year are converted at year end exchange rates. The difference in conversion of monetary assets & liabilities and realised gains & losses on foreign exchange transaction are recognised in the Statement of Prot and Loss. In respect of forward cover contracts for future probable transactions, the mark to market loss as at the year end is charged to Statement of Prot and Loss. i) Employee benets Dened Contribution plan Contribution to pension fund, Superannuation payable as per superannuation scheme is provided by payment to superannuation trust fund, administered by the HDFC Standard Life Insurance and ICICI Prudential Life Insurance Co. Ltd., ESIC and labour welfare fund are recognised as an expense in the statement of prot and loss. Dened Benet plan The Companys contribution to provident fund, administered through a Company managed trust, is recognised as an expense in the statement of prot and loss. The gratuity liability, actuarially valued, is funded through the scheme administered by the Life Insurance Corporation of India (LIC) and HDFC Standard Life Insurance and the amounts paid / provided under the scheme are charged to statement of prot and loss. Accumulated leave liability (other than sick leave) as at the year end is provided as per actuarial valuation. Accumulated sick leave is provided for at actuals in the statement of prot and loss. j) Taxes on Income Income tax expense comprises current tax (i.e. amount of tax for the year determined in accordance with the income tax law). Deferred Tax asset & liabilities are recognised as per Accounting Standard -22 on accounting for Taxes on Income, issued pursuant to the Companies (Accounting Standards) Rules 2006 by the Central Government. Provisions, Contingent Liabilities and Contingent Assets Provisions are recognised only when there is a present obligation as a result of past events and when a reliable estimate of the amount of the obligation can be made. Contingent liability is disclosed for (i) Possible obligations which will be conrmed only by the future events not wholly within the control of the company or (ii) Present obligations arising from past events where it is not probable that an outow of resources will be required to settle the obligation or a reliable estimate of the amount of the obligation can not be made. Contingent Assets are not recognised in the nancial statements. l) Measurement of EBITDA The Company has elected to present earning before interest, tax, depreciation and amortisation ( EBITDA) as a separate line item on the face of the statement of the prot and loss.
k)

Y II. Other Explanatory Notes and Information
H in lacs As at 31st March, 2013 2012 1,197.58 1,675.64
Estimated amount of contracts net of advances remaining to be executed on capital accounts
II
Contingent liabilities not provided for. i) Letter of credit, Guarantees and counter guarantees ii) Liabilities Disputed in appeals - Excise duty - Sales Tax - Income Tax - Stamp Duty iii) Claims against the company not acknowledged as debt iv) Non fullment of export obligation against advance licence v) Disputed liability in respect of Ministry of Industry, Department of Chemicals and Petrochemicals in respect of price of Rifampicin allowed in formulations and landed cost of import.
1,921.70 759.83 383.93 4.58 501.19 342.64 23.73 34.93
1,334.25 745.22 324.52 501.19 356.64 145.00 34.93
III
Dened benet plans / compensated absences - As per actuarial valuation Expense recognised in the Statement of Prot & Loss Current Service Cost Interest Cost Employer Contributions Expected return on plan assets Net Acturial (Gains) / Losses Past Service Cost Settlement Cost Total expense Net Asset / (Liability) recognised Present value of Dened Benet Obligation as at March 31, 2013 Fair value of plan assets as at March 31, 2013 Funded status [Surplus / (Decit)] Net asset / (liability) as at March 31, 2013 Change in Obligation Present value of Dened Benet Obligation at the beginning of the year Current Service Cost Interest Cost Settlement Cost Past Service Cost Employer Contributions Acturial (Gains) / Losses Benets Payments Present value of Dened Benet Obligation at the end of the year
31.03.2013 Gratuity Funded 174.60 83.01 (76.74) 46.03 226.90 1,224.41 996.83 (227.58) (227.58) 1,036.11 174.60 83.01 49.71 (119.01) 1,224.41
31.03.2012 Gratuity Funded 161.46 75.24 (66.94) (90.62) 79.14 1,036.11 785.43 (250.68) (250.68) 940.54 161.46 75.24 (90.62) (50.51) 1,036.11

Y II. Other Explanatory Notes and Information(Contd.)
31.03.2013 Gratuity Funded Change in Assets Plan assets at the beginning of the year Employer Contributions Assets acquired in amalgamation in previous year Settlements Expected return on plan assets Funds to be transfer as per the Scheme of Arrangement Actual benets paid Acturial (Gains) / Losses Plan assets at the end of the year Acturial Assumptions: Discount Rate Expected rate of return on plan assets Mortality pre retirement Mortality post retirement Turnover rate Medical premium ination Rate of escalation in salary (p.a.) * LIC ( 1994-96) Published table of rates. 785.43 250.00 76.74 (119.01) 3.68 996.83 8.20% 9.00% *LIC Rates NA 5% to 1% NA 4.75% 31.03.2013 Leave Encashment Expense recognised in the Statement of Prot & Loss Current Service Cost Interest Cost Employer Contributions Expected return on plan assets Net Acturial (Gains) / Losses Past Service Cost Settlement Cost Total expense Net Asset / (Liability) recognised in the Balance Sheet Present value of Dened Benet Obligation as at March 31, 2013 Fair value of plan assets as at March 31, 2013 Funded status [Surplus / (Decit)] Net asset / (liability) as at March 31, 2013 Change in Obligation Present value of Dened Benet Obligation at beginning of the year Current Service Cost Interest Cost Settlement Cost Past Service Cost Employer Contributions 112.24 38.87 165.94 317.05 650.87 (650.87) (650.87) 580.81 112.24 38.87 H in lacs 31.03.2012 Gratuity Funded 769.00 66.94 (50.51) 785.43 8.50% 9.00% *LIC Rates NA 5% to 1% NA 4.75% 31.03.2012 Leave Encashment 105.84 44.59 41.00 191.43 580.81 (580.81) (580.81) 557.35 105.84 44.59 -

Acturial (Gains) / Losses Benets Payments Present value of Dened Benet Obligation at the end of the year 31.03.2013 Leave Encashment 165.94 (247.00) 650.87 H in lacs 31.03.2012 Leave Encashment 41.00 (167.97) 580.81
in lacs As at 31st March, 31.03.2013 31.03.2012 IV a)The Company enters into Currency Swaps to hedge against uctuation in changes in exchange rate and interest rates outstanding No. of Contracts Notional Principal b) The year end foreign currency exposure that have not been hedged by a derivative instrument or otherwise are as follows: 1. Amount receivable in foreign currency on account of the following - Export of Goods and Services NIL NIL 1 8.33
USD
USD EUR GBP AUD USD EUR GBP CHF USD EUR GBP CHF JPY USD EUR GBP USD
212.57 28.32 0.68 0.25 9.91 1.96 0.24 0.03 70.06 1.38 0.03 0.01 4.36 0.42 0.05 260.00
USD EUR GBP AUD USD EUR GBP CHF USD EUR GBP CHF JPY USD EUR GBP USD
180.60 23.04 9.62 33.04 1.79 0.16 0.10 58.91 2.28 0.08 0.12 5.91 0.67 253.36
- Advance to Suppliers
2. Amount payable in foreign currency on account of the following - Purchase of Goods and Services
- Advance from Customers
- Loans payable

H in lacs As at 31st March, 2013 2012 V Based on information / documents available with the Company, Sundry Creditors include: 55.65 a) Amounts due to Micro, Small & Medium Enterprises (Total Amount) 54.31 37.84 b) Amount overdue on account of principal and / or interest 37.67 26.97 c) Amount outstanding together with interest for more than 45 days 30.46 However, the credit terms extended by the party are more than 45 days and the company makes payment on due date and hence no interest provision is made. As per requirement of Section 22 of Micro, Small & Medium Enterprises Development Act, 2006 following information is disclosed to the extent identiable (a) (i) The principal amount remaining unpaid to any supplier at the end of accounting year (ii) The interest due on above Total of (i) and (ii) above (b) Amount of interest paid by the buyer in terms of section 18 of the Act (c) The amounts of payment made to the supplier beyond the due date (d) The amount of interest due and payable for the period of delay in making payment (which have been paid but beyond the due date during the year) but without adding the interest specied under the Act. VI Segment Reporting Primary Segment The Company has identied "Pharmaceuticals" as the only primary reportable segment. In view of the inter-woven/inter-mixed nature of business and manufacturing facility, other secondary segmental information is not ascertainable. VII Disclosures in respect of Related Parties pursuant to Accounting standard - AS 18 - issued by the Institute of Chartered Accountants Of India pursuant to Companies (Accounting Standards) Rules 2006 are as follows List of Related Parties with whom the Company has entered into transactions during the year. a) Controlling Companies: There is no controlling Company b) Subsidiary and Fellow Subsidiary: 1 Alembic Global Holding SA (Subsidiary of Alembic Pharmaceuticals Limited) 2 Alembic Pharmaceuticals Australia Pty Ltd (Subsidiary of Alembic Global Holding SA.) 3 Alembic Pharmaceuticals Europe Ltd (Subsidiary of Alembic Global Holding SA.) 4 Alnova Pharmaceuticals SA (Subsidiary of Alembic Global Holding SA.) 5 Alembic Pharmaceuticals Inc. (Subsidiary of Alembic Global Holding SA.) Associate Companies: 1 Alembic Ltd. 2 Whiteeld Chemtech Pvt. Ltd. 3 Nirayu Pvt. Ltd. 4 Quick Flight Ltd. 5 Shreno Ltd. 55.65 0.97 56.62 54.31 0.49 54.80 -
c)
6 7 8 9 10
Paushak Ltd. Sierra Investments Ltd. Viramya Packlight Ltd Incozen Therapeutics Pvt. Ltd. Rhizen Pharmaceuticals SA

d) Key Management personnel 1 Shri C .R. Amin 2 Shri R. K. Baheti 3 Shri Pranav Amin 4 Shri Shaunak Amin Chairman and Managing Director Director, President - Finance & Company Secretary Director, President-International Business President - Formulations
e)
Relatives of Key Management Personnel : 1 Smt. Malika Amin 2 Shri Udit Amin 3 Ms. Yera Amin 4 Ms. Jyoti Patel 5 Ms. Ninochaka Kothari 6 Ms. Shreya Mukherjee
During the year, the following transactions were carried out with related parties and relative of Key Management Personnel in the ordinary course of the business H in lacs Key Management Key Management Associates Associates Personnel Personnel For the year ended on 31st March, 2013 2012 2013 2012 i) Purchase of Goods/DEPB 9,416.98 -Individually more than 10% 6,704.98 1,446.91 -Others 325.47 ii) Sale of Goods/DEPB 387.03 -Individually more than 10% 334.37 11.63 -Others 43.95 iii) Purchase of Fixed Assets -Individually more than 10% 1,282.10 -Others 1.11 iv) Rendering of services 270.51 -Individually more than 10% 276.63 0.85 -Others 0.01 v) Receiving of services 1,239.85 -Individually more than 10% 716.71 85.96 -Others 64.54 vi) Rent Paid 120.95 -Individually more than 10% 68.21 7.50 -Others 7.06 vii) Deposit Given -Individually more than 10% 2,749.67 -Others viii) Interest Received 875.76 -Individually more than 10% 944.83 -Others 2.76 ix) Dividend Paid 1,750.50 91.96 -Individually more than 10% 1,250.35 75.75 0.02 -Others 0.02 -

H in lacs
Associates Loans Given -Individually more than 10% -Others xi) Managerial Remuneration Salary Provident Fund and others Superannuation Commission xii) Outstanding balance as at 31st March, - Advances - Creditors - Loans Given - Deposit Given - Investment For the year ended on 31st March, Dividend Paid Salary Paid x) 14,800.00 2013 543.25 281.78 2,749.67 300.00
Associates 10,193.00 700.00 2012 373.70 364.53 6,300.00 2,749.67 300.00
Key Management Personnel 751.76 52.56 2.99 741.34 2013
Key Management Personnel 632.78 51.04 45.55 540.13
2012 Relatives of Key Managerial Personnel 2013 2012 91.58 56.37 88.31 83.00
VIII Listing Agreement clause 32 disclosure Disclosures as required under clause 32 of listing agreement have not been given as there are no such transactions with any such party / Employee. IX Earning Per Share (EPS) For the year ended on 31st March, a) Prot after tax but before Non -Recurring Items available for equity shareholders. b) Prot after Tax available for equity shareholders c) Weighted Average number of equity shares d) Basic and Diluted Earnings per share before Non-Recurring Items. (Face value per share H 2/- each ) e) Basic and Diluted Earnings per share after Non-Recurring Items. (Face value per share H 2/- each ) Auditors Fees and Expenses include remuneration to: For the year ended on 31st March, a) Statutory Auditors:As Auditors In Other Capacity:(i) Other Services a. Limited Review b. Others (ii) Reimbursement of expenses b) Cost Auditors :As Cost Auditors 2013 15,744.36 15,744.36 18,85,15,914 8.35 8.35 2012 12,053.51 12,053.51 18,85,15,914 6.39 6.39
2013
2012
25.00
21.00
19.50 6.50 3.07 1.25
19.50 4.82 1.50 1.25

H in lacs
2013 c) Tax Auditor : Tax Audit Fee 2.00 57.32 2013 46,501.58 1,521.68 48,023.26 2013 15,541.82 908.97 364.40 215.68 4,958.85 21,989.72 2013 14,593.67 33,544.32 30% 70%
2012 2.00 50.07 2012 46,795.60 1,160.44 47,956.04 2012 18,631.48 218.03 338.32 54.60 3,502.28 22,744.71 2012 13,831.59 40,208.89 26% 74%
XI
Income in Foreign Currency For the Year ended on 31st March, - Export (FOB basis ) - Royalty
XII Expenditure in foreign currency For the Year ended on 31st March, - Raw Materials ( CIF basis) - Packing Material ,Components and Spare parts ( CIF basis ) - Professional and Consultancy Fees - Interest - Others
XIII Break up of Imported /Indigenous Material For the Year ended on 31st March, (a) Value of imported raw materials, spares parts and components consumed (b) Value of indigenous raw materials, spare parts and components consumed (c) Percentage of above to total consumption: (i) Imported raw materials, spare parts and components consumed (ii) Indigenous raw materials, spare parts and components consumed
XIV The previous years gures have been regrouped / rearranged wherever necessary to make it comparable with the current year. As per our report of even date For K. S. AIYAR & CO. Chartered Accountants Firm Registration No. 100186W RAGHUVIR M. AIYAR Partner Membership No 38128 Mumbai : 2nd May, 2013 CHIRAYU R. AMIN Chairman & Managing Director PARESH SARAIYA Director PRANAV AMIN Director & President International Business MILIN MEHTA Director R.K. BAHETI Director, President Finance & Company Secretary Vadodara : 2nd May, 2013 K.G. RAMANATHAN Director
Statement pursuant to Section 212 of the Companies Act,1956

H in lacs
1 2
Name of the Subsidiary Accounting year of the Subsidiary ended on Share of the Subsidiary held by the Company on above date. ( a) Number (b) Extent of holding Net aggregate amount of prot of the subsidiary for above accounting period, of the subsidiary so far as they concern the members of company: ( a ) dealt with in account of the Company for the year ended on 31st March, 2013 ( b ) not dealt with in account of the Company for the year ended on 31st March, 2013 Net aggregate amount of prot of the subsidiary for previous nancial year of the subsidiary since it becomes a Subsidiary so far as they concern the members of company: ( a ) dealt with in account of the Company for the year ended on 31st March, 2012 ( b ) not dealt with in account of the Company for the year ended on 31st March, 2012
ALEMBIC GLOBAL HOLDING SA 31st March, 2013 1,00,000 100%
781.11
959.75
CHIRAYU R. AMIN Chairman & Managing Director PARESH SARAIYA Director
PRANAV AMIN Director & President International Business MILIN MEHTA Director
K.G. RAMANATHAN Director
R.K. BAHETI Director, President Finance & Company Secretary Vadodara : 2nd May, 2013
Information on the Financials of the Subsidiary Company

For the year ended on 31st March
Name of the Subsidiary Company Capital Reserves Total Liabilities Total Assets Investment (Other than in subsidiaries) Turnover (Net) Prot / (Loss) before tax Provision for Tax Prot / (Loss) after tax Proposed Dividend Note Any Shareholder interested in obtaining particulars of Subsidiary, may obtain by writing to the Company Secretary of the Company H in lacs Alembic Global Holding SA 2013 2012 56.96 56.38 4,294.55 3,390.85 596.06 2,721.78 4,919.09 6,140.82 28.48 28.19 2,770.86 9,110.31 819.63 1,083.11 38.52 123.36 781.11 959.75 -
Independent Auditors Report

To the Board of Directors of Alembic Pharmaceuticals Limited
We have audited the accompanying consolidated nancial statements of Alembic Pharmaceuticals Limited (the Company) wherein are included unaudited consolidated nancial statements of its 100% subsidiary i.e. Alembic Global Holding SA, Switzerland.These Financial statements comprise the consolidated Balance Sheet as at March 31, 2013, and the consolidated Statement of Prot and Loss and consolidated Cash Flow Statement for the year then ended, and a summary of signicant accounting policies and other explanatory information. Managements Responsibility for the Consolidated Financial Statements Management is responsible for the preparation of these consolidated nancial statements that give a true and fair view of the consolidated nancial position, consolidated nancial performance and consolidated cash ows of the Company in accordance with accounting principles generally accepted in India; this includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the consolidated nancial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error. Auditors Responsibility Our responsibility is to express an opinion on these consolidated nancial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated nancial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated nancial statements.The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the consolidated nancial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Companys preparation and presentation of the consolidated nancial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the consolidated nancial statements. We believe that the audit evidence we have obtained is sufcient and appropriate to provide a basis for our audit opinion. Opinion In our opinion and to the best of our information and according to the explanations given to us and based on what is noted as Other Matter below, the consolidated nancial statements give a true and fair view in conformity with the accounting principles generally accepted in India: (a) in the case of the consolidated Balance Sheet, of the state of affairs of the Company as at March 31, 2013; (b) in the case of the consolidated Statement of Prot and Loss, of the prot for the year ended on that date; and (c) in the case of the consolidated Cash Flow Statement, of the cash ows for the year ended on that date. Other Matter The standalone Financial Statements of Alembic Global Holding SA (AGH), 100 % Subsidiary of the Company, duly audited by another auditor along with their report thereon was furnished to us. We are informed that during the year, AGH has set up 4 Step down subsidiaries which are yet to be operational. The consolidated nancial statements of AGH are unaudited as they are not required to be audited under local laws. These consolidated nancial statements include total assets (net) of H 1,40,77,301.16 as at March 31, 2013, total revenues of H 34,40,718.00 and net cash inows amounting to H 1,06,42,613.16 for the year then ended of the said 4 Step down Subsidiaries that are unaudited. Our opinion is not qualied in respect of this matter.
For K.S. Aiyar & Co; Chartered Accountants FRN: 100186W Raghuvir M. Aiyar Partner M. No. 38128
Mumbai Date: 2nd May, 2013
Consolidated Balance Sheet

Particulars I. EQUITY AND LIABILITIES (1) Shareholder's Funds (a) Share Capital (b) Reserves and Surplus (c) Foreign Currency Translation Reserve (2) Non-Current Liabilities (a) Long-Term Borrowings (b) Deferred Tax Liabilities (Net) (c) Other Long-Term Liabilities (d) Long-Term Provisions (3) Current Liabilities (a) Short-Term Borrowings (b) Trade Payables (c) Other Current Liabilities (d) Short-Term Provisions Total II.Assets (1) Non-current assets (a) Fixed Assets (i) Tangible Assets (ii) Capital Work-in-Progress (b) Non-Current Investments (c) Long Term Loans And Advances (2) Current assets (a) Inventories (b) Trade Receivables (c) Cash and Bank Balances (d) Short-Term Loans and Advances Total Signicant Accounting Policies and other explanatory notes and information Y Note No As at 31st March, 2013 H in lacs As at 31st March, 2012 A B 3,770.32 45,854.35 669.60 7,053.47 1,389.69 1,276.07 606.06 7,011.45 23,996.43 6,925.29 6,229.69 3,770.32 35,183.09 546.43 9,485.67 952.90 1,229.07 539.04 13,843.49 20,914.53 15,160.44 3,566.34
50,294.27
39,499.84
C D E F G H I J
10,325.29
12,206.69
44,162.86 1,04,782.42
53,484.80 1,05,191.33
K L M
34,422.15 3,226.18 330.28 3,587.88
41,566.49
26,782.19 5,823.97 329.99 3,499.13
36,435.28
N O P Q
26,683.33 23,287.08 1,610.60 11,634.92
63,215.93 1,04,782.42
25,874.15 19,933.11 4,708.97 18,239.82
68,756.05 1,05,191.33
Note : The notes referred to above form an integral part of the Consolidated Balance Sheet As per our report of even date For K. S. AIYAR & CO. Chartered Accountants Firm Registration No. 100186W RAGHUVIR M. AIYAR Partner Membership No 38128 Mumbai : 2nd May, 2013 CHIRAYU R. AMIN Chairman & Managing Director PARESH SARAIYA Director PRANAV AMIN Director & President International Business MILIN MEHTA Director R.K. BAHETI Director, President Finance & Company Secretary Vadodara : 2nd May, 2013 K.G. RAMANATHAN Director
Consolidated Statement of Profit and Loss

Particulars I. Revenue from Operations Less : Excise Duty II. Other Income III. Total Revenue (I +II) IV. Expenses: Cost of Materials Consumed Purchase of Finished Goods Changes in Inventories of Finished Goods and Work in Process Employee Benet Expenses Research and Development Expenses Other Expenses Total Expenses V. Prot before Interest, Depreciation and Tax Finance Costs Depreciation VI. Prot before Tax VII. Tax Expense Current Tax Deferred Tax VIII. Prot for the Year IX. Earning Per Equity Share (FV J 2/- Per Share) Basic & Diluted (In H) Signicant Accounting Policies and Other Explanatory Notes and Information Note : The notes referred to above form an integral part of the Consolidated Statement of Prot and Loss Note No R S For the Year ended on 31st March, 2013 1,52,909.69 875.00 1,52,034.69 393.20 1,52,427.89 47,029.77 18,905.90 2,134.01 19,378.97 7,363.28 32,026.25 1,26,838.19 25,589.71 1,457.43 3,496.86 20,635.42 4,013.52 96.43 16,525.47 8.77 Y H in lacs For the Year ended on 31st March, 2012 1,47,094.74 554.00 1,46,540.74 142.07 1,46,682.81 52,823.76 24,412.24 (6,443.98) 16,845.82 5,858.22 31,102.19 1,24,598.25 22,084.56 2,621.34 3,364.98 16,098.24 3,123.36 (38.38) 13,013.26 6.90
T T U V W
Consolidated Cash Flow Statement

H in lacs Particulars A CASH FLOW FROM OPERATING ACTIVITIES: Net Prot Before Tax Add: Depreciation Interest Charged Unrealised Foreign Exchange Loss / (Gain) Foreign Currency Translation Reserve General Reserve Utilised for Expenses as per The Scheme of Year ended on 31st March, 2013 20,635.42 3,496.86 2,398.20 272.02 122.82 3.39 940.77 22.70 6,293.29 3,364.98 3,754.84 1,125.94 397.53 67.06 (0.53) 1,133.50 0.35 67.06 8,709.82 Year ended on 31st March, 2012 16,098.24
1 2 3 4 5
Arrangement 6 (Gain)/Loss on Sale of Fixed Assets Less: 1 Interest Income 2 Dividend Income 3 Expenses on Account of Scheme of Arrangement debited to Reserves Operating Prot Before Change in Working Capital Working Capital Changes: Add / (Less): (Increase) / Decrease in Inventories (Increase) / Decrease in Trade Receivables (Increase) / Decrease in Short-Term Loans and Advances (Increase) / Decrease in Long-Term Loans and Advances Increase / (Decrease) in Trade Payables Increase / (Decrease) in Other Current Liabilities Increase / (Decrease) in Short Term Provisions Increase / (Decrease) in Long Term Provisions Cash Generated from Operations Add / (Less): Direct Taxes Paid (Net of Refunds) Net Cash Inow from Operating Activities (A) CASH FLOW FROM INVESTING ACTIVITIES: Add: Proceeds from Sale of Fixed Assets Increase in Restrictive Bank Balances Interest Received Dividend Received Less: Purchase of Tangible Assets / Increase in Capital Work-in-Progress Net Cash Inow from Investing Activities (B)
963.47 25,965.24
1,200.92 23,607.15
1 2 3 4 5 6 7 8
(809.18) (3,613.41) 5,692.72 (88.75) 3,485.46 (456.25) 108.32 67.02
4,385.92 30,351.17 (3,869.54) 26,481.63
(3,950.96) 538.97 (6,715.41) (2,844.66) 6,619.64 (18.54) 182.97 28.88
(6,159.09) 17,448.06 (3,270.80) 14,177.26
B 1 2 3 4
54.97 1,817.51 22.70 1,895.18
4.55 26.49 455.27 0.35 486.67 6,125.63 8,597.33 (6,702.15) 6,125.63 (5,638.96)
8,597.33
Consolidated Cash Flow Statement (Contd.)

Particulars C 1 2 1 2 3 4 CASH FLOW FROM FINANCIAL ACTIVITIES: Add: Proceeds from Long-Term Borrowings Increase in Other Long Term Liabilities Less: Repayment of Long-Term Borrowings Repayment of Short-Term Borrowings Dividends Paid (Including Distribution Tax) Interest and Other Finance Costs Net Cash Inow from Financing Activities (C) Year ended on 31st March, 2013 H in lacs Year ended on 31st March, 2012
47.00 10,177.02 6,832.04 3,036.23 2,879.56
47.00
6,628.21 44.90 4,462.07 784.19 2,164.49 3,720.61
6,673.11
22,924.85 (22,877.85) (3,098.37)
11,131.36 (4,458.25) 4,080.04
II. Net (Decrease)/Increase in Cash and Cash Equivalents III. Add: Cash and Cash Equivalents at the Beginning of the Period Add: Other Bank Balances IV. Cash and Cash Equivalents at the End of the Period Other Bank Balances
4,682.48 26.49 1,552.97 57.63
4,708.97 1,610.60
628.93 4,682.48 26.49
628.93 4,708.97
Consolidated Notes to Balance Sheet

A Share Capital :
H in lacs As at 31st March (a) Shares authorised 20,00,00,000 Equity shares of H 2/- each (b) Shares issued, subscribed and fully paid : 18,85,15,914 Equity shares of H 2/- each Out of above 13,35,15,914 equity shares of H 2/- each were issued to the share holders of Alembic Limited as per the Scheme of Arrangement and without payment being received in cash (c) 3,770.32 Reconciliation of the number of shares outstanding at the beginning and at the end of the reporting period ; 3,770.32 2013 4,000.00 4,000.00 3,770.32 2012 4,000.00 4,000.00 3,770.32
31st March 2013 31st March 2012 Numbers Amount in lacs Numbers Amount in lacs 18,85,15,914 3,770.32 At the beginning of the period 5,50,00,000 1,100.00 Issued during the period 13,35,15,914 2,670.32 18,85,15,914 3,770.32 Outstanding at the end of the period 18,85,15,914 3,770.32 (d) The rights, preferences and restrictions including restrictions on the distribution of dividends and the repayment of capital; The company is having only one class of shares i.e Equity carrying a nominal value of H 2/- per share Every holder of the equity share of the Company is entitled to one vote per share held In the event of liquidation of the Company, the equity shareholders will be entitled to receive remaining assets of the Company after the distribution / repayment of all creditors. The distribution to the equity shareholders will be in proportion of the number of shares held by each shareholder The Company declares and pays dividend on the equity shares in Indian Rupees. Dividend proposed by the Board of Directors is subject to approval of the shareholders at the ensuing Annual General Meeting During the year ended 31st March, 2013 an amount of H 2.50 of dividend per equity share was proposed for the equity shareholders ( PY H 1.40 per equity share) (e) Shares in the company held by each shareholder holding more than 5 percent shares specifying the number of shares held; 31st March 2013 Numbers 5,50,00,000 1,83,68,780 1,71,67,670 1,82,85,230 1,62,13,755 31st March 2012 Numbers 5,50,00,000 1,83,68,780 1,71,67,670 1,82,85,230 1,62,13,755
1 2 3 4 5
Alembic Limited Shreno Limited Sierra Investments Limited Whiteeld Chemtech Limited Nirayu Private Limited
% held 29.18% 9.74% 9.11% 9.70% 8.60%
% held 29.18% 9.74% 9.11% 9.70% 8.60%

B Reserves and Surplus :
H in lacs As at 31st March (a) Capital Reserve ; Balance as per the last nancial statements (b) Debenture Redemption Reserve; Balance as per the last nancial statements Less : Transferred to General Reserve Add : Transferred from Statement of Prot and Loss (c) General Reserve Balance as per the last nancial statements Less : Utilised against provision for expenses on account of Scheme of Arrangement Less : Reversal of Deferred Tax Asset on account of Intangible assets pursuant to the order of Hon'ble Gujarat High Court Add : Transfer from Debenture redemption reserve Add : Amount transferred from Surplus Balance in the Statement of Prot & Loss (d) Surplus / (decit) in the statement of prot and loss Balance as per last nancial statements Prot for the year Appropriations Less: Transfer to Debenture redemption reserve Proposed nal equity dividend amount per share H 2.50 (PY : H 1.40) Tax on proposed equity dividend Transfer to General Reserve Total Appropriations Net Surplus in the statement of prot and loss Total Reserves and Surplus 2013 30.00 3,125.00 3,125.00 23,798.35 340.36 3,125.00 8,000.00 2,333.40 791.60 19,319.21 67.04 453.82 2012 30.00
3,125.00
34,582.99
5,000.00
23,798.35
8,229.74 16,525.47 4,712.90 800.96 8,000.00 13,513.86 11,241.36 45,854.35
4,075.45 13,013.26 791.60 2,639.22 428.15 5,000.00 8,858.97 8,229.74 35,183.09
C Long-Term Borrowings :
As at 31st March (a) Non Convertible Debentures (Secured) H NIL (PY H 5000 lacs) 9.25% Coupon of H 1 lac each Secured against rst hypothecation charge on all movable plant and machinery ranking pari passu with other lenders Redeemable equally in July-12 and Sept-12 and redeemed H NIL (PY H 2500 lacs) 10.80% Coupon of H 1 lac each Secured against rst hypothecation charge on all movable plant and machinery ranking pari passu with other lenders Redeemable in June-12 and redeemed Non-Current 2013 2012 Current Maturities 2013 2012 5,000.00
2,500.00

C Long-Term Borrowings (Contd.) :
As at 31st March (b) Term loans (Secured) Foreign Currency loan from Banks - @ Coupon of LIBOR plus 1.50% p.a. plus proportionate front end fees Secured against rst hypothecation charge on all movable plant and machinery ranking pari passu with other lenders Redeemable in 15 equal quarterly installments of USD 1 MN starting from May-13 Foreign Currency loan from Banks - @ varying rate of interest Secured against rst hypothecation charge on all movable plant and machinery ranking pari passu with other lenders Redeemable in Apr-12 USD 1.67 MN and balance in June-12 and redeemed (c) Deposits (Unsecured) Deposits from Shareholders Deposits from Public - @ interest rate varying from 9% to 11% and maturity period is 12 / 24 / 36 months (d) Others (Unsecured) Repayable in 10 equal yearly installments of H 2.85 lacs each commencing from October 2004. Interest rate 3% The above amount includes amount disclosed under the head Other Current Liabilities (Note I) 7,053.47 9,485.67 7,053.47 9,485.67 4,614.24 (4,614.24) 11,942.92 (11,942.92) 1,624.27 Non-Current 2013 2012 5,970.80 7,632.00 H in lacs Current Maturities 2013 2012 2,171.20 -
419.30 663.37
159.30 1,691.52
210.20 2,229.99
174.50 2,641.30
2.85
2.85
2.85
D Deferred Tax Liabilities (Net) :

As at 31st March Deferred Tax Assets Provision for Doubtful debts Preliminary Expense and Demerger Expense Intangible Asset Others Deferred Tax Liabilities Depreciation 2013 175.83 32.76 1,021.09 426.21 1,655.89 3,045.58 1,389.69 2012 172.59 46.97 1,361.45 367.59 1,948.60 2,901.50 952.90

E Other Long Term Liabilities :
H in lacs As at 31st March Trade Deposits 2013 1,276.07 1,276.07 2012 1,229.07 1,229.07
F Long Term Provisions :

As at 31st March 2013 (a) Provision for employee benets. Provision for gratuity Provision for Leave benets (b) Others Proposed equity dividend Provision of tax on Proposed equity dividend Amount disclosed under the head Short term provisions (Note J) 606.06 539.04 Long Term 2012 539.04 539.04 Short Term 2013 2012 304.48 302.81 607.29 4,712.90 800.96 5,513.86 (6,121.15) 250.68 248.29 498.97 2,639.22 428.15 3,067.37 (3,566.34) -
606.06 606.06 -
G Short-Term Borrowings :
As at 31st March (a) From Banks i) Working Capital facilities (Secured) Secured against rst hypothecation on Stocks and Book Debts ranking pari passu - @ varying Coupon repayable on demand ii) Others (Unsecured) - @ varying Coupon repayable within 180 days with an option of roll over (b) Commercial Paper (Unsecured) - @ Coupon of 10.20% repayable within 90 days 5,970.80 8,986.05 2013 1,040.65 2012 2,357.44
7,011.45
2,500.00 13,843.49
H Trade Payable :
As at 31st March Due to Micro and Small Enterprises Other Trade Payables 2013 55.65 23,940.78 23,996.43 2012 54.31 20,860.22 20,914.53

I Other Current Liabilities :
H in lacs As at 31st March (a) Current maturities of long-term debt (Note C) (b) Interest accrued but not due on borrowings (c) Unpaid dividends (d) Unpaid / Unclaimed matured deposits and interest accrued thereon Unclaimed matured Deposits Interest accrued thereon (e) Other payables / liabilities; Statutory dues Others 2013 4,614.24 193.69 57.63 48.03 2.13 748.42 1,261.15 6,925.29 2012 11,942.92 675.52 26.49 36.05 1.66 765.31 1,712.49 15,160.44
J Short-Term Provisions :
As at 31st March (a) Provision for employee benets. (Note F) (b) Others . Proposed equity dividend and Tax thereon (Note F) Provision for Income Tax Less : Income Tax paid 2013 607.29 5,513.86 8,802.69 (8,694.15) 108.54 6,229.69 3,566.34 2012 498.97 3,067.37
K Tangible Assets :
DESCRIPTION As on 01/04/2012 Free Hold Land Lease Hold Land Buildings Employees Quarters Plant & Equipments R&D Equipments Furniture & Fixtures Vehicles Ofce Equipments Pre-operative Expense TOTAL Previous Year 192.44 1,634.78 9,730.56 28.30 24,076.74 7,240.58 596.89 2,384.98 404.12 1.71 46,291.10 43,353.80 GROSS BLOCK Addition 4,915.53 5,697.25 264.38 95.10 105.18 117.68 11,195.12 2,951.92 Deductions 200.64 37.74 238.38 14.62 As on 31/03/2013 192.44 1,634.78 14,646.09 28.30 29,573.35 7,504.96 691.99 2,452.42 521.80 1.71 57,247.84 46,291.10 As on 01/04/2012 63.26 1,786.40 6.59 12,606.52 4,136.83 257.76 524.21 125.96 1.38 19,508.91 16,154.53 DEPRECIATION Deductions 150.67 29.35 180.02 10.60 During the Year 17.21 348.62 2,291.98 569.67 36.72 156.87 75.40 0.33 3,496.80 3,364.98 As on 31/03/2013 80.47 2,135.02 6.59 14,747.83 4,706.50 294.48 651.73 201.36 1.71 22,825.69 19,508.91 NET BLOCK As on 31/03/2013 192.44 1,554.31 12,511.07 21.71 14,825.52 2,798.46 397.51 1,800.69 320.44 34,422.15 26,782.19 As on 31/03/2012 192.44 1,571.52 7,944.16 21.71 11,470.22 3,103.75 339.13 1,860.77 278.16 0.33 26,782.19
Notes: 1. Sales proceeds are deducted from gross cost where cost is unascertainable 2. No Depreciation has been claimed on assets to the extent of Cenvat claimed

L Non-Current Investments :
H in lacs As at 31st March Trade Investments : Unquoted equity instruments Others 1,000,000 (PY: 1,000,000) equity shares of H 10 each at a premium of H 20 each fully paid up in Incozen Therapeutics Pvt. Ltd. towards seed funding for Contract Research 50,000 (PY: 50,000) equity shares of CHF 1 each fully paid up in Rhizen Pharmaceuticals SA for development activities in area of drug discovery and clinical development Non-Trade Investments : Unquoted equity instruments 18,000 (PY: 18,000) equity shares of H 1 each fully paid up in Shivalik Solid Waste Management Ltd. 330.28 329.99 2013 2012
300.00
300.00
28.48
28.19
1.80
1.80
M Long-Term Loans and Advances (Unsecured, Considered Good) :

As at 31st March (a) Capital Advances (b) Security Deposits 2013 625.42 2,962.46 3,587.88 2012 395.26 3,103.87 3,499.13
N Inventories (Refer Note Y (e) of Accounting Policies for Basis of Valuation) :

As at 31st March (a) Raw materials - API, Chemicals and Intermediates - Excipients - Solvents & Catalyst (b) Packing materials (c) Work-in-process (d) Finished goods - API, Chemicals and Intermediates - Formulations - Tablets and Capsules - Formulations - Injectables - Formulations - Oral Preparation and Ointments - Others (e) Traded goods - Formulations - Tablets and Capsules - Formulations - Injectables - Formulations - Oral Preparation and Ointments (f) Stores and spares 2013 5,127.14 3,032.87 609.06 2012 2,474.10 2,993.40 492.79
8,769.07 1,669.10 1,448.48
5,960.29 1,509.03 994.08
7,422.15 1,043.35 425.42 587.05 2,799.11 1,153.71 362.56 748.72
12,277.08
9,992.97 1,587.71 591.32 807.64 1,352.43 1,567.40 360.95 870.06
14,332.07
2,264.99 254.61 26,683.33
2,798.41 280.26 25,874.15

O Trade Receivables (Unsecured) :
H in lacs As at 31st March (a) Over Six months from the due date Considered good Considered doubtful Less : Provision for doubtful debts (b) Others Considered good; 2013 901.66 541.94 541.94 2012 122.74 531.96 531.96
901.66 22,385.42 23,287.08
122.74 19,810.37 19,933.11
P Cash and Bank Balances :

As at 31st March (a) Cash and cash equivalents (i)Bank deposits with less than 3 months maturity from the origin date (ii)Balances with banks (iii)Cash on hand (b) Other Bank Balances Unpaid Dividend Account 2013 5.15 1,523.97 23.85 57.63 1,610.60 2012 2,304.60 2,348.83 29.05 26.49 4,708.97
Q Short-Term Loans and Advances (Unsecured, considered good) :

As at 31st March (a) Loans and advances to related parties; Inter Corporate Deposits (b) Others (i) Advance against Expenses - Employees (ii) Advance recoverable in cash or in kind (iii) Income Tax paid Less : Provision for Income Tax 2013 430.02 11,204.90 11,634.92 4,864.09 (4,828.65) 2012 6,300.00 290.05 11,614.32 35.44 18,239.82
Consolidated Notes to Statement of Profit and Loss

R Revenue from Operations :
H in lacs For the year ended 31st March a) Sale of products - Domestic - Exports Export Incentives Royalty Other Operating Revenues - Others Sale of Products - Broad head wise Bulk Drugs, Chemicals and Intermediates Formulations - Tablets and Capsules Formulations - Injectables Formulations - Oral Preparation and Ointments 2013 1,00,877.42 49,412.39 1,50,289.81 789.27 1,521.68 308.93 1,52,909.69 35,056.90 77,090.99 11,055.23 27,086.69 1,50,289.81 37,345.88 72,288.02 11,393.63 23,302.35 1,44,329.88 2012 87,717.89 56,611.99 1,44,329.88 1,298.85 1,160.44 305.57 1,47,094.74
b)
S Other Income :
For the year ended 31st March Dividend Insurance Claims Rent 2013 22.70 370.50 393.20 393.20 2012 0.35 98.00 43.72 142.07 142.07

T Cost of Material Consumed :
H in lacs For the year ended 31st March Inventory at the beginning of the year Add : Purchases Less : Inventory at the end of the year Details of Material Consumed API Drug and Drug intermediates Excipients Solvents & Catalyst Packing Material Others Changes in inventories of Finished Goods, Work in process : Inventory at the end of the year Work in Process Finished Goods Inventory at the beginning of the year Work in Process Finished Goods 2013 7,469.32 49,998.62 57,467.94 10,438.17 47,029.77 26,092.43 7,052.23 5,260.90 7,213.90 1,410.31 47,029.77 2012 9,768.62 50,524.46 60,293.08 7,469.32 52,823.76 24,366.90 9,202.41 5,802.39 7,561.89 5,890.17 52,823.76
1,448.48 14,542.07 15,990.55 994.08 17,130.48 18,124.56 2,134.01
994.08 17,130.48 18,124.56 934.20 10,746.38 11,680.58 (6,443.98)
U Employee Benets Expense :

For the year ended 31st March Salaries and Wages Contribution / Provisions for Provident and other funds Staff welfare expense 2013 18,168.23 854.89 355.85 19,378.97 2012 15,617.14 903.64 325.04 16,845.82
V Research & Development Expenses :

For the year ended 31st March Material Consumption Employees' Cost Salaries and Wages Contribution / Provisions for Provident and other funds Utilities Power Others Bio-Study Expense & Filing Fees Others 2013 1,416.08 2,238.00 91.94 345.69 87.50 2,098.15 85.65 203.62 145.66 2012 874.95
2,329.94
2,183.80
433.19 781.78 2,402.29 7,363.28
349.28 969.88 1,480.31 5,858.22

W Other Expenses :
H in lacs For the year ended 31st March Consumption of Stores, spares, Laboratory Material and Analytical Expense Power and Fuel Manufacturing and Labour Charges Repairs and Maintenance Machinery Buildings Others Freight and Forwarding Charges Marketing and Publicity Expense and Selling Commission Excise Duty Rent Rates and Taxes Insurance Travelling Expense Communication Expenses Legal & Professional Fees Payment to Auditor Exchange Difference (net) Bad Debts written off Less : Bad Debts Provision Utilised Provision for Doubtful Debts Miscellaneous Expenses 2013 1,798.79 2,665.51 1,794.05 509.88 241.73 266.96 518.95 190.07 287.45 2012 1,989.33 2,957.42 1,976.97
1,018.57 2,128.11 13,357.09 100.49 335.96 497.94 220.78 5,888.19 1,058.35 714.08 58.17 (297.18) 50.00 637.37 32,026.25
996.46 2,172.59 10,820.75 508.84 206.03 472.38 207.39 5,179.98 973.56 935.75 51.69 655.84 306.02 691.20 31,102.19
40.02 40.02
355.83 355.83
X Finance Costs :
For the year ended 31st March Interest Expense Less : Interest Income 2013 2,398.20 940.77 1,457.43 2012 3,754.84 1,133.50 2,621.34
Y NOTES FORMING PART OF CONSOLIDATED FINANCIAL STATEMENTS:

1. BASIS OF PREPARATION : The Consolidated Financial Statements (CFS) are prepared in accordance with Accounting Standard 21 (AS) Consolidated Financial Statements issued by the Institute of Chartered Accountants of India. PRINCIPLES OF CONSOLIDATION : A) The CFS comprise the nancial statement of Alembic Pharmaceuticals Limited (The Holding Company) and its Subsidiary.The Financial Statements of both companies are in line with generally accepted accounting principles in India. B) Inter company transactions have been eliminated on consolidation. 3. COMPANIES INCLUDE IN CONSOLIDATION : SUBSIDIARY Alembic Global Holding SA 4. COUNTRY OF INCORPORATION Switzerland PROPORTION OF OWNERSHIP INTEREST AS ON 31st March, 2013 100%
2.
ACCOUNTING POLICIES: The accounting policies of the Holding company and that of its subsidiary are similar and as per generally accepted accounting principles in India. TRANSLATION OF ACCOUNTS: In Consolidated Accounts, the Accounts of subsidiary company have been translated into INR considering as non-integral operations of the company as prescribed under AS-11 foreign currency transaction EPS: H in lacs Year ended 31st March, 2013 16,525.47 16,525.47 18,85,15,914 8.77 8.77
5.
6.
Prot after tax but before Non Recurring Items available for equity shareholders Prot after tax available for equity shareholders Weighted average numbers of equity shares Basic and diluted Earnings per share before Non Recurring Items ( Face Value per share H 2/- each) Basic and diluted Earnings per share after Non Recurring Items ( Face Value per share H 2/- each)
Corporate Information
Board of Directors
Mr. Chirayu R. Amin Chairman & Managing Director Mr. K.G. Ramanathan Director Mr. Paresh Saraiya Director Mr. Pranav N. Parikh Director Mr. Milin Mehta Director Mr. Pranav Amin Director & President-International Business Mr. Shaunak Amin Director & President-Branded Formulations Business (w.e.f. 2nd May, 2013) Mr. R. K. Baheti Director & President-Finance & Company Secretary Village Karakhadi, Taluka Padra District Vadodara, Gujarat.
Regd. Ofce
Alembic Road, Vadodara-390003 Tel: (0265) 2280550, 2280880 Fax: (0265) 2282506 Email: apl.investors@alembic.co.in
Manufacturing Facilities
Panelav, Tal. Halol, Dist. Panchmahal-389350. Gujarat Plot No.21, 22, EPIP-Phase I Jharmajri, Baddi, Tehsil-Nalagarh Dist. Solan, Himachal Pradesh
Statutory Auditors
K.S. Aiyar & Co. Chartered Accountants Laxmi Estate No. F-07/08 Shakti Mills Lane Off Dr. E. Moses Road Mahalaxmi, Mumbai-400 011
Bankers
AXIS Bank Limited Bank of Baroda HDFC Bank Limited IDBI Bank Limited Standard Chartered Bank The Royal Bank of Scotland N.V
Registrar of Transfer Agents

Link Intime India Pvt. Limited B-102 & 103, Shangrila Complex, First Floor, Opp. HDFC Bank, Near Radhakrishna Char Rasta, Akota, Vadodara-390020 Tel: (0265) 2356573, 2356794 Fax: (0265) 2356791 Email: vadodara@linkintime.co.in
DESTINY IS NO MATTER OF CHANCE. IT IS A MATTER OF CHOICE. IT IS NOT A THING TO BE WAITED FOR, IT IS A THING TO BE ACHIEVED. - William Jennings Bryan
www.alembic-india.com
NOTICE
Notice is hereby given that the 3rd Annual General Meeting of the Members of Alembic Pharmaceuticals Limited will be held at Sanskruti, Alembic Corporate Conference Center, Opp. Pragati Sahakari Bank Limited, Alembic Colony, Vadodara - 390 003, on Wednesday, the 7th August, 2013 at 4.00 p.m. to transact the following business: ORDINARY BUSINESS 1. To receive and adopt the Audited Balance Sheet as at 31st March, 2013, Statement of Prot & Loss and Cash Flow Statement of the Company for the year ended on that date and the Reports of the Directors and Auditors thereon. 2. To declare dividend on Equity Shares. 3. To appoint a Director in place of Mr. Paresh Saraiya, who retires by rotation and being eligible, offers himself for re-appointment. 4. To appoint a Director in place of Mr. Milin Mehta, who retires by rotation and being eligible, offers himself for re-appointment. 5. To appoint M/s K. S. Aiyar & Co., Chartered Accountants, as Statutory Auditors of the Company to hold ofce from the conclusion of this Annual General Meeting until conclusion of the next Annual General Meeting and to authorise the Board of Directors to x their remuneration. SPECIAL BUSINESS To transact the following business as special business: 6. To consider and if thought t, to pass with or without modications the following resolution as an Ordinary Resolution: RESOLVED THAT Mr. Shaunak Amin, who was appointed as an Additional Director of the Company w.e.f. 2nd May, 2013 and who vacates his ofce at this Annual General Meeting be and is hereby appointed as the Director of the Company liable to retire by rotation. 7. To consider and if thought t, to pass with or without modications the following resolution as a Special Resolution: Revision in Remuneration payable to Mr. Pranav Amin, Director & President International Business: RESOLVED THAT subject to the provisions of Sections 198, 309 and 310 read with Schedule XIII and other applicable provisions, if any, of the Companies Act, 1956, (including any statutory modications or reenactment thereof for the time being in force) approval of the members of the Company be and is hereby accorded to revision in remuneration payable to Mr. Pranav Amin as Director & President-International Business of the Company w.e.f. 1st April, 2013 for the remaining period of his appointment upto 31st March, 2016, as recommended by the Board of Directors at its meeting held on 2nd May, 2013 and set out hereunder with liberty and authority to the Board of Directors to alter and vary such remuneration from time to time within permissible limits of the Companies Act, 1956, or any amendment thereto or any re-enactment thereof and as may be agreed to between the Board of Directors and Mr. Pranav Amin. Revised Remuneration: Basic Salary, Perquisites and other allowance/benets up to maximum CTC of H4.00 Crores per annum or such higher amount as may be decided by the Board of Directors of the Company, from time to time. Perquisites and Allowances: a) Housing: Company Leased Housing Accommodation or House Rent Allowance as per the rules of the Company. b) Leave Travel Concession for self and family as per rules of the Company. c) Medical Reimbursement, Medical Insurance and Personal Accident Insurance, as per rules of the Company. d) Conveyance: As per rules of the Company. e) Free Telephone Facility at the residence as per rules of the Company. f) Contribution to Provident Fund, Superannuation Fund and Gratuity Fund shall be as per rules of the Company. g) Leave: As per rules of the Company. Privilege Leave accumulated and not availed of during this tenure as Director & President-International Business may be allowed to be encashed as per rules of the Company. h) Other perquisites, allowances, benefits and amenities as per the ser vice Rules of the Company as applicable from time to time. RESOLVED FURTHER THAT in the event of loss or inadequacy of prots in any nancial year, the Company shall pay in respect of such nancial year, the remuneration paid for immediately preceding nancial year as minimum remuneration by way of salary, allowances, perquisites and other benets, subject to the provisions of the Companies Act, 1956 or any statutory modication or re-enactment thereof and necessary approvals, if any. FURTHER RESOLVED THAT the Board of Directors of the Company be and is hereby authorized to take such steps as may be necessary, desirable or expedient to give effect to this resolution. 8. To consider and if thought fit, to pass with or without modications the following resolution as a Special Resolution: RESOLVED THAT pursuant to provisions of Sections 198, 269, 309 read with Schedule XIII and other applicable provisions, if any, of the Companies Act, 1956 (including any statutory modication or re-enactment thereof for the time being in force) the approval of the shareholders be and is hereby accorded to the appointment of Mr. Shaunak Amin as Director & President Branded Formulations Business of the Company for a period of 5 years effective from 2nd May, 2013 on remuneration and on such terms and conditions as set out hereinafter with liberty and authority to the Board of Directors to alter and vary the terms and conditions of said appointment from time to time subject to the provisions of the Companies Act, 1956 or any amendment thereto or any re-enactment thereof and as may be agreed to between the Board of Directors and Mr. Shaunak Amin. Terms and Conditions of Appointment: 1. Term of Appointment : 5 years from 2nd May, 2013 to 1st May, 2018. Annual Report 2012-13 1
NOTICE
2. Remuneration : Subject to the ceiling prescribed under the provisions of Companies Act, 1956 (including any statutory modication or re-enactment thereof), the following shall be the remuneration payable to Mr. Shaunak Amin as Director & President Branded Formulations Business: Basic Salary, Perquisites and other allowance/benets up to maximum CTC of H4.00 Crores per annum or such higher amount as may be decided by the Board of Directors of the Company, from time to time. Perquisites and Allowances: a) Housing: Company Leased Housing Accommodation or House Rent Allowance as per the rules of the Company. b) Leave Travel Concession for self and family as per rules of the Company. c) Medical Reimbursement, Medical Insurance and Personal Accident Insurance, as per rules of the Company. d) Conveyance: As per rules of the Company. e) Free Telephone Facility at the residence as per rules of the Company. f) Contribution to Provident Fund, Superannuation Fund and Gratuity Fund shall be as per rules of the Company. g) Leave: As per rules of the Company. Privilege Leave accumulated and not availed of during this tenure as Director & President-Branded Formulations Business may be allowed to be encashed as per rules of the Company. h) Other perquisites, allowances, benets and amenities as per the service Rules of the Company as applicable from time to time. 3. Minimum Remuneration: In the event of loss or inadequacy of prots in any nancial year, the remuneration paid for immediately preceding nancial year shall be paid as minimum remuneration by way of salary, allowances, perquisites and other benets, subject to the provisions of the Companies Act, 1956 and necessary approvals, if any. 6. NOTES: 1. ANY MEMBER ENTITLED TO ATTEND AND VOTE IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE INSTEAD OF HIMSELF AND SUCH PROXY NEED NOT BE A MEMBER OF THE COMPANY. The Proxy form duly completed must reach the Registered Ofce of the Company not later than forty-eight hours before the time of holding the meeting. The Register of Members of the Company will remain closed from Wednesday, the 31st July, 2013 to Wednesday, the 7th August, 2013, (both days inclusive), for the purpose of payment of dividend. The dividend when sanctioned will be made payable on or after Monday, 12th August, 2013, to those members whose names appear on the Register of Members of the Company on 7th August, 2013 in case of Physical shares and to those members as per the beneciary position given by NSDL and CDSL. Members are requested to notify promptly any change in their registered address. All the work related to share registry in terms of both - physical and electronic are being conducted by Companys R & T Agents M/s. Link-Intime India Pvt. Limited, B-102 & 103, Shangrila Complex, First Floor, Opp. HDFC Bank, Near Radhakrishna Char Rasta, Akota, Vadodara 390020 Tel:(0265) 2356573, 2356794 Fax:(0265) 2356791 Email: vadodara@linkintime.co.in. The Shareholders are requested to send their communication to the aforesaid address in future. The Equity Shares of the Company are compulsorily traded in dematerialized (demat) mode as mandated by the SEBI. Therefore, those members who hold shares in physical mode are advised to get their shares dematerialized (i.e. conversion of physical shares into electronic mode) at the earliest. 2.
3.
4.
5.
7. The Ministry of Corporate Affairs has vide its Circulars No. 17/2011 dated 21st April, 2011 and No. 18/2011 dated 29th April, 2011 has taken a Green Initiative in the Corporate Governance by allowing paperless compliances by the Companies by way of service of notice/documents including Annual Report by e-mail to its members. To support this green initiative of the Government, members holding shares in electronic mode are requested to register their e-mail address with their Depository Participants. Members holding shares in physical mode may submit their e-mail address to the R&T Agents of the Company.
RESOLVED FURTHER THAT in the event of loss or inadequacy of prots in any nancial year, the Company shall pay in respect of such nancial year, the remuneration paid for immediately preceding nancial year as minimum remuneration by way of salary, allowances, perquisites and other benets, subject to the provisions of the Companies Act, 1956 or any statutory modication or re-enactment thereof and necessary approvals, if any. RESOLVED FURTHER THAT the Board of Directors of the Company be and is hereby authorised to take such steps as may be necessary, desirable or expedient to give effect to this resolution.
Registered Ofce: Alembic Road, Vadodara - 390 003 Date: 2nd May, 2013
By Order of the Board,
R. K. Baheti Director-Finance & Company Secretary
NOTICE
Explanatory Statement as required under Section 173 of the Companies Act, 1956 Item No. 6 The Board has appointed Mr. Shaunak Amin as Additional Director w.e.f. 2nd May, 2013 who will vacate his ofce as Director at the ensuing Annual General Meeting. The Company has received notice from a member along with deposits of H 500/- proposing the candidature of Mr. Shaunak Amin to be appointed as Director, liable to retire by rotation at ensuing Annual General Meeting. Your Directors recommend the resolution for your approval. None of the Directors of the Company are in any way concerned or interested in the resolution except Mr. Shaunak Amin himself and Mr. Pranav Amin and Mr. Chirayu Amin being relatives of Mr. Shaunak Amin. Item No. 7 The Board of Directors of the Company at its meeting held on 2nd May, 2013 has, on the basis of recommendation of Remuneration Committee, approved, subject to approval of shareholders in General Meeting, revision in remuneration payable Mr. Pranav Amin, Director & President International Business of the Company. Mr. Shaunak Amin has graduated from University of Massachusetts, The present remuneration of Mr. Pranav Amin, Director & President International Business is effective from 1st April, 2011. The Company has made fast progress since then and has shown healthy growth in terms of Revenues from H 1,165 Crores in 2010-11 to H 1,492.62 Crores in 2012-13 as well as in terms of prots from H 81.50 Crores to H 157.45 Crores during the same period. The share of International Business in the Revenues and in the prots of the Company has also increased considerably and the International Business possesses good potential for future growth. Considering the signicant progress made by the Company during the tenure of Mr. Pranav Amin as Director & President International Business and considering the Industry benchmarks for the remuneration of similar positions, the Board has approved the revision in remuneration to Mr. Pranav Amin, Director & President International Business. The proposed remuneration is within overall limits of remuneration payable as per Companies Act, 1956. This may be treated as an abstract of terms and memorandum of interest pursuant to Section 302 of the Companies Act, 1956. Your Directors recommend the resolution for your approval. None of the Directors of the Company are in any way concerned or interested in the resolution except Mr. Shaunak Amin himself and Mr. Pranav Amin and Mr. Chirayu Amin being relatives of Mr. Shaunak Amin. Registered Ofce: Alembic Road, Vadodara - 390 003 Date: 2nd May, 2013 By Order of the Board, USA with Economics as his specials. He has varied work experience with renowned Multinationals including Merril Lynch, Hong Kong and Shanghai Banking Corporation etc. His extensive experience in Sales and Marketing has beneted the Company immensely in achieving the new heights in sales. He has vast experience of a decade He holds directorships AGI Developers Limited, Gujarat Flying Club (Section 25 Company) and Incozen Therapeutics Pvt. Ltd. He holds 1006980 Equity Shares of the Company. This may be treated as an abstract of terms and memorandum of interest pursuant to Section 302 of the Companies Act, 1956. Your Directors recommend the resolution for your approval. None of the Directors of the Company are in any way concerned or interested in the resolution except Mr. Pranav Amin himself and Mr. Shaunak Amin and Mr. Chirayu Amin being relatives of Mr. Pranav Amin. Item No. 8. The Board of Directors at its meeting held on 2nd May, 2013, on the basis of recommendation of Remuneration Committee, approved appointment of Mr. Shaunak Amin as Director & President Branded Formulations Business of the Company w.e.f. 2nd May, 2013. Mr. Shaunak Amin has been working for the Branded Formulations business of the Company (prior to demerger in Alembic Limited) since 2005 when he was appointed as Chief Business Development Ofcer, he was promoted as President Formulations on 30th September, 2009. On 31st March, 2011, when he was transferred to the Company due to demerger of Pharmaceutical undertaking of Alembic Limited. He has been President-Formulations of the Company since then. The Companys branded formulations business has grown considerably during his tenure as President Formulations. The Branded Formulations unit of the Company employs more than 3000 employees headed by Mr. Shaunak Amin.
R. K. Baheti Director-Finance & Company Secretary
ALEMBIC PHARMACEUTICALS LIMITED Alembic Road, Vadodara - 390 003.
ATTENDANCE
SLIP
To be handed over at the entrance of the Meeting Hall For Physical Holding LF No. For Electronic Form (Demat) NSDL / CDSL DPID CLIENT ID No. of Shares Held
I hereby record my presence at the ANNUAL GENERAL MEETING of the Company at Sanskruti, Alembic Corporate Conference Centre, Opp. Pragati Sahakari Bank Limited, Alembic Colony, Vadodara - 390 003 on Wednesday, the 7th August, 2013 at 4.00 p.m. NAME OF THE MEMBER / JOINT MEMBER / JOINT MEMBER(S) (IN BLOCK CAPITALS):
Notes:
1. Shareholder / Proxy-holder must bring the Attendance Slip to the meeting and hand it over duly signed at the entrance of the meeting hall. 2. Joint Shareholders may obtain additional Attendance Slip/s by prior intimation to Office. 3. Please strike off whichever is not applicable.
SIGNATURE OF THE MEMBER/ JOINT MEMBER(S) / PROXY
ALEMBIC PHARMACEUTICALS LIMITED Alembic Road, Vadodara - 390 003.
P R OX Y For Physical Holding LF No.
F O R M No. of Shares Held
For Electronic Form (Demat) NSDL / CDSL DPID CLIENT ID
I/We_______________________________________________________________________________________ of _________________________________________________________________________________________ being Member (s) of ALEMBIC PHARMACEUTICALS LIMITED hereby appoint _______________ of ____________ of failing him _________________________________ of ________________________________ as my / our proxy to attend and vote for me / us and on my / our behalf at the ANNUAL GENERAL MEETING of the Company to be held on Wednesday, the 7th August, 2013 and at any adjournment thereof. Signed this _______ Day of ______________2013.
Notes: 1. Proxy form must reach the Companys Registered office not less than 48 hours before the Meeting. 2. The form should be signed across the stamp as per specimen signature registered with the Company 3. Please strike off whichever is not applicable.
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Alembic Pharmaceuticals Limited

Annual Report 2012-13

control your destiny or someone else will

Some years ago, we resolved to reinvent our

Alembic Pharmaceuticals Limited

Annual Report 2012-13 3

MANAGEMENT DISCUSSION AND ANALYSIS

Net prot (` lac)

Cash prot (` lac)

3.75% 10.06% 15.87% 29.58% 26.99% 60.08% 22.25% 34.35%

4 Alembic Pharmaceuticals Limited

Net Prot margin (%)

EBIDTA margin growth

Net margin growth

173 bps 656 bps

197 bps 738 bps

(11) bps 2161 bps

668 bps 2168 bps

Annual Report 2012-13 5

MANAGEMENT DISCUSSION AND ANALYSIS

Controlling our destiny

in the three years leading to 2012-13.

annually for the next three years.

in 2013-14, which also includes Para IV FTF lings.

6 Alembic Pharmaceuticals Limited

Promising oppor tunities

IMS size (US$ billion) of Alembics pending approval ANDAs

Annual Report 2012-13 7

MANAGEMENT DISCUSSION AND ANALYSIS

Controlling our destiny

Stronger European footprint

8 Alembic Pharmaceuticals Limited

product to ve products in just two years.

Accelerated European revenues in the three years leading to 2012-13

2012-13 (15 dossier lings as on March 31, 2013).

respected European generic players.

years by 20% CAGR upto 2012-13.

authorisations across European nations

speciality products in Europe

basket for the European markets.

Annual Report 2012-13 9

MANAGEMENT DISCUSSION AND ANALYSIS

Controlling our destiny

months, strengthening our market coverage on progressive molecules.

representative and eld team, facilitating a deeper domestic penetration.

presence through new divisions.

10 Alembic Pharmaceuticals Limited

Our speciality business growth in 2012-13

Annual Report 2012-13 11

MANAGEMENT DISCUSSION AND ANALYSIS

Controlling our destiny

considerably in just two years.

through the commercialisation of 11 speciality APIs in 2013-14.

customers among whom we ourselves positioned as a primary/alternate source for APIs.

diversication and acquire new clients in emerging markets.

Annual Report 2012-13 13

MANAGEMENT DISCUSSION AND ANALYSIS

Strength in our numbers 3.23 75 34 8

domestic market with eight products

existing therapeutic segments

Top-3 of the Rabeprazole market

and emerging markets

Percentage of Alembic exports derived from regulated markets